February 2016

  • Google AI Algorithm Masters Ancient Game of Go

    What it is:  A computer has just beaten the world's best Go player. AlphaGo, a program created by Google-owned AI company DeepMind, beat European Go champ Fan Hui all five times they played in tournament conditions, and also won 99.8% of Go games against other computer programs. Unlike IBM's Deep Blue, which defeated chess champ Garry Kasparov, AlphaGo wasn't programmed to play Go. Instead, as Nature reports, it learned how to play via a general-purpose algorithm that interpreted the game's patterns.

    Why it's important:  AlphaGo's learning technique means it can recognize complex patterns, long-term planning and decision-making: refined skills that were once stricly human in nature. Imagine the possibilities when neural networks like AlphaGo, infinite computing and the 'Internet of Everything' converge.

     

    Nature via Peter Diamandis.

  • Google AI Algorithm Masters Ancient Game of Go

    What it is:  A computer has just beaten the world's best Go player. AlphaGo, a program created by Google-owned AI company DeepMind, beat European Go champ Fan Hui all five times they played in tournament conditions, and also won 99.8% of Go games against other computer programs. Unlike IBM's Deep Blue, which defeated chess champ Garry Kasparov, AlphaGo wasn't programmed to play Go. Instead, as Nature reports, it learned how to play via a general-purpose algorithm that interpreted the game's patterns.

    Why it's important:  AlphaGo's learning technique means it can recognize complex patterns, long-term planning and decision-making: refined skills that were once stricly human in nature. Imagine the possibilities when neural networks like AlphaGo, infinite computing and the 'Internet of Everything' converge.

     

    Nature via Peter Diamandis.

  • Trading After Groundhog Day

    On Groundhog Day, Bespoke put out these charts and comments (with minor edits).
     
    When Punxsutawney Phil Speaks, People Listen

     

    Forget about EF Hutton, or for that matter Warren Buffett.  If you really want to know where stock prices are going and can’t wait until the Super Bowl, look no further than the Oracle of Punxsutawney, Phil the groundhog!  Given his ‘perfect’ record at predicting the weather, we wanted to check up on the groundhog’s ability to predict the direction of the stock market.

    Going back to 1944, when Groundhog Day resumed following a brief pause during World War II, Punxsutawney Phil has seen his shadow on the morning of February 2nd 59 times and seen no shadow just 13 times.  The table and chart below summarize the performance of the S&P 500 from Groundhog Day through the first day of Spring in each year based on whether or not Phil sees his shadow or not. (Disclaimer: If you are reading and still think this post is meant in any way to be taken seriously, it is not.)

      

    160213 Groundhog Day 1 

    160213 Groundhog Day 2

     

    On years when Phil sees his shadow, it not only means we are in for a longer winter but also sub-par stock returns.  In the 59 years where Phil has seen his shadow, indicating a long winter is in store, the S&P 500’s median return from that day up until the first day of spring has been a gain of 0.54% with gains 54% of the time.  Those returns don’t sound so bad, but they are actually below average.  That’s because in the thirteen years where Phil did not see his shadow the S&P 500 saw a median gain of 3.01% with positive returns more than three-quarters of the time.  

    As shown in the lower chart, there are only three years (1997, 2007, and 2011) since 1944 than Punxsutawney Phil did not see his shadow and the S&P 500 declined from Groundhog Day through the first day of spring.  Of those three years, the worst decline was 2.17%.  With the S&P 500 already down 1.6% today, the S&P 500 has some digging out to do if it is going to continue its trend of winning ways following those days when the groundhog doesn’t see his shadow.  It’s so easy a groundhog can do it!

     

    Right … so, you know that was poo poo de moo moo. Punxsutawney Phill doesn't predict markets.

    This year started with an 11 % drop.  While that is the steepest drop to start a year,  I'm pretty sure that doesn't mean much either.  With similar numbers, the market ultimately went down 32 % in 2008 — and up 33 % in 2009.

    Markets go up – and markets go down.  It's not what happens, it's what you do that matters.

  • Trading After Groundhog Day

    On Groundhog Day, Bespoke put out these charts and comments (with minor edits).
     
    When Punxsutawney Phil Speaks, People Listen

     

    Forget about EF Hutton, or for that matter Warren Buffett.  If you really want to know where stock prices are going and can’t wait until the Super Bowl, look no further than the Oracle of Punxsutawney, Phil the groundhog!  Given his ‘perfect’ record at predicting the weather, we wanted to check up on the groundhog’s ability to predict the direction of the stock market.

    Going back to 1944, when Groundhog Day resumed following a brief pause during World War II, Punxsutawney Phil has seen his shadow on the morning of February 2nd 59 times and seen no shadow just 13 times.  The table and chart below summarize the performance of the S&P 500 from Groundhog Day through the first day of Spring in each year based on whether or not Phil sees his shadow or not. (Disclaimer: If you are reading and still think this post is meant in any way to be taken seriously, it is not.)

      

    160213 Groundhog Day 1 

    160213 Groundhog Day 2

     

    On years when Phil sees his shadow, it not only means we are in for a longer winter but also sub-par stock returns.  In the 59 years where Phil has seen his shadow, indicating a long winter is in store, the S&P 500’s median return from that day up until the first day of spring has been a gain of 0.54% with gains 54% of the time.  Those returns don’t sound so bad, but they are actually below average.  That’s because in the thirteen years where Phil did not see his shadow the S&P 500 saw a median gain of 3.01% with positive returns more than three-quarters of the time.  

    As shown in the lower chart, there are only three years (1997, 2007, and 2011) since 1944 than Punxsutawney Phil did not see his shadow and the S&P 500 declined from Groundhog Day through the first day of spring.  Of those three years, the worst decline was 2.17%.  With the S&P 500 already down 1.6% today, the S&P 500 has some digging out to do if it is going to continue its trend of winning ways following those days when the groundhog doesn’t see his shadow.  It’s so easy a groundhog can do it!

     

    Right … so, you know that was poo poo de moo moo. Punxsutawney Phill doesn't predict markets.

    This year started with an 11 % drop.  While that is the steepest drop to start a year,  I'm pretty sure that doesn't mean much either.  With similar numbers, the market ultimately went down 32 % in 2008 — and up 33 % in 2009.

    Markets go up – and markets go down.  It's not what happens, it's what you do that matters.

  • Here Are Some Links for Your Weekend Reading

    Here is the e-card I sent to my wife.  Happy Valentine's Day!

     

    160214 i-want-to-grow-old-and-disgusting-with-you
     

    Here are some of the posts that caught my eye. Hope you find something interesting.

     

    Lighter Links:

     

    Trading Links:

  • Here Are Some Links for Your Weekend Reading

    Here is the e-card I sent to my wife.  Happy Valentine's Day!

     

    160214 i-want-to-grow-old-and-disgusting-with-you
     

    Here are some of the posts that caught my eye. Hope you find something interesting.

     

    Lighter Links:

     

    Trading Links:

  • The Boy Who Sees Without Eyes

    Innovation comes in many forms. I often challenge my research team to come at the edge-finding process differently. For example, how can you tell what’s happening in the stock market (or in your portfolio) without looking at the market?

    As an example, I might ask how we could determine the number of people in a room, without using sight?  To answer, you could: ask; use heat signatures; detect the number of heartbeats, etc.  The point is, there is usually a way if you want it badly enough. 

    The story and video below captured my attention … and admiration. 

    Hope you enjoy it.

     

    Diagnosed with retinal cancer at the age of two, Ben Underwood had his eyes removed at the age of three.

    Still, he was able to detect the location of objects by making frequent clicking noises with his tongue. He used it to accomplish such feats as running, playing basketball, riding a bicycle, rollerblading, playing football, and skateboarding.

    Check out the video.

     

     

     

    Via CBS News.

    He died just before his 17th birthday; but his life is still an inspiration.

    For more, watch this.

  • The Boy Who Sees Without Eyes

    Innovation comes in many forms. I often challenge my research team to come at the edge-finding process differently. For example, how can you tell what’s happening in the stock market (or in your portfolio) without looking at the market?

    As an example, I might ask how we could determine the number of people in a room, without using sight?  To answer, you could: ask; use heat signatures; detect the number of heartbeats, etc.  The point is, there is usually a way if you want it badly enough. 

    The story and video below captured my attention … and admiration. 

    Hope you enjoy it.

     

    Diagnosed with retinal cancer at the age of two, Ben Underwood had his eyes removed at the age of three.

    Still, he was able to detect the location of objects by making frequent clicking noises with his tongue. He used it to accomplish such feats as running, playing basketball, riding a bicycle, rollerblading, playing football, and skateboarding.

    Check out the video.

     

     

     

    Via CBS News.

    He died just before his 17th birthday; but his life is still an inspiration.

    For more, watch this.

  • Jimmy Kimmel Ghostwrote a Children’s Book for Donald Trump Titled ‘Winners Aren’t Losers’

    Donald Trump has accomplished a lot in his career.  

    He built a real estate empire and wrote 12 books — but, there is something he hasn't done.
     
    Appearing on Jimmy Kimmel Live! recently, Trump admitted he wanted to give authoring a kids' book a try, but hadn't yet.  Fortunately, host Jimmy Kimmel revealed he ghostwrote one for the presidential hopeful.
     
    Authored and illustrated in the style of a Dr. Seuss book, Winners Aren't Losers tells the story of an inspiring Trump trying to direct children and animals to be winners instead of—you guessed it—losers.

     

     
     
     
    Jimmy Kimmel via YouTube.
     
    "Winners aren't losers. They're winners—like me! A loser's a loser. Which one will you be?" Kimmel read from the book. "Winners do deals and winners get rich, while sad little losers just sit there and bitch."
     
    "This should be a big seller," Trump joked.
     
     

  • Jimmy Kimmel Ghostwrote a Children’s Book for Donald Trump Titled ‘Winners Aren’t Losers’

    Donald Trump has accomplished a lot in his career.  

    He built a real estate empire and wrote 12 books — but, there is something he hasn't done.
     
    Appearing on Jimmy Kimmel Live! recently, Trump admitted he wanted to give authoring a kids' book a try, but hadn't yet.  Fortunately, host Jimmy Kimmel revealed he ghostwrote one for the presidential hopeful.
     
    Authored and illustrated in the style of a Dr. Seuss book, Winners Aren't Losers tells the story of an inspiring Trump trying to direct children and animals to be winners instead of—you guessed it—losers.

     

     
     
     
    Jimmy Kimmel via YouTube.
     
    "Winners aren't losers. They're winners—like me! A loser's a loser. Which one will you be?" Kimmel read from the book. "Winners do deals and winners get rich, while sad little losers just sit there and bitch."
     
    "This should be a big seller," Trump joked.