Trading Tools

  • Is Luck Something You Create?

    This article explores the fine line between luck and skill in business, trading, and life. You’ll learn why success often comes from preparation and adaptability—not just fortunate timing—and discover actionable strategies for identifying and nurturing genuine skill in any competitive arena.

    Picture a trader making millions in a raging bull market. Are they a genius, or just riding a wave of market luck? Now, picture yourself in their shoes. How do you know if tomorrow’s market crash will expose a lack of skill or confirm your edge?

    Distinguishing luck from skill isn’t just a Wall Street problem—it’s the secret sauce behind enduring careers, resilient businesses, and long-term success stories everywhere.

    Introduction: The Illusion of Streaks

    Imagine achieving an unbroken streak of successes—so improbable that it seems almost magical. Was it raw talent, or was the universe simply smiling on you?

    It’s human nature to believe it was your skill.

    Now, imagine someone else achieved that streak. It is comforting to attribute some of that to luck.

    What about a series of coin flips that land on heads twenty-five times in a row? Was that lucky, or have you discovered a new law of probability?

    Easy, that was just luck.

    This highlights a common trap known as confirmation bias: when things go well, we tend to attribute our success to our skill; when they don’t, we blame it on bad luck. Recognizing this bias is essential if we want to improve; otherwise, we risk falling into blind spots that prevent us from learning.

    In 2016, I wrote an article about differentiating between luck and skill in trading. Those concepts seem even more relevant today as I spend more time talking with entrepreneurs and AI enthusiasts.

    The Psychology of Success: Luck, Skill, and the Illusion of Mastery

    Luck comes in many flavors. Most people prefer good luck to bad luck.

    Focusing on the good, there are many lucky individuals in the business world. Perhaps they made a good decision at the right time – and are now on top of the world. Luck isn’t a bad thing — but building your entire strategy around it is a risky bet for lasting success. Why? Because you might get lucky once, but it’s unlikely you’ll get lucky every time.

    As the saying goes, luck favors the prepared mind—especially those capable of discerning where skill ends and luck begins.

    The Coin Flipping Contest: A Case Study in Probability

    20250831 Coin FlipFirst, let’s examine luck a little bit. To do that, think about a nationwide coin-flipping contest. Initially, each citizen is paired up with another for a contest. The winner goes on to the next round. Think how many rounds you would need to win to be City Champion, State Champion, Regional Champion, etc. Ultimately, someone would have won many coin-flip contests to make it to the final rounds of the tournament. Assuming they didn’t cheat, they were lucky. Does the winner have an edge? If so, what could it be?

    Suppose you followed the contest from beginning to end. As you approached the Championship Round, can you imagine the Finalists doing articles or interviews about how their mindfulness practice gives them an edge … or, how the law of attraction was the secret…. or, how the power of prayer makes all the difference.

    Occam’s Razor often applies: the best explanation is usually the simplest—someone had to win, and this time, it was luck, not mastery.

    In any competition, someone will always win, but that doesn’t mean the winner is always the most skilled.

    Luck isn’t just in trading or tech. Think of sports — sometimes, a championship hinges on a referee’s call or an unexpected bounce, not just one team’s superior skill. In music, countless talented musicians remain undiscovered, while some viral videos catapult their creators into overnight stardom. That’s the unpredictable role of luck at work in every field.

    Warren Buffett once remarked: ‘It’s only when the tide goes out that you discover who’s been swimming naked.’ Success in a favorable market can look like skill — but only real skill endures when times get tough.

    Likewise, just because a product or business generates revenue doesn’t necessarily prove it has a competitive edge. Every day, countless new AI-based apps are released. Many make money, some even become popular, but how many of them will still be here 5 years from now? Often, the businesses that are doing the best aren’t actually the ones providing the best service; they’re the ones with the best marketing & the most luck. 

    Lessons from Dot-Coms and Startups

    Remember the dot-com era in the late ’90s? For every Amazon or Google that survived, hundreds like Pets.com and Webvan didn’t. Success often wasn’t about being the best; it was about timing, adaptability—and, sometimes, pure luck.

    Focusing solely on current profitability can mean you might have a genuine edge—or you might have simply experienced a streak of good luck. If it isn’t just a matter of winning, how do we determine if we’re skillful? In trading, we refer to this as “Alpha” — the measure of a strategy’s returns attributable to genuine skill, rather than market trends or lucky breaks. Thus, the search for alpha is the search for clues that help identify systems with an edge (or at least an edge in certain market conditions).

    Unfortunately, I cannot provide you with a single rule to follow in distinguishing between skill and luck. Still, it’s much easier to find the answer if you actively seek to differentiate between the two. Recognizing whether preparation or fortune played the bigger part requires conscious, continuous examination.

    The reality is that most situations aren’t as purely luck-based as a coin-flipping contest. Many people appear lucky because they put themselves in the right situations and did the gritty work behind the scenes to prepare themselves for opportunities. 

    Do You Really Have an Edge? Validation Matters

    That’s where skill (and the ability to filter out bad opportunities) comes in. 

    Internally, we’ve built validation protocols to help filter out systems that got lucky or those that cannot replicate their results on unseen data.

    It is exciting as we solve more of the bits and pieces of this puzzle.

    What we have learned is that one of the secrets to long-term success is (unsurprisingly) adaptability.

    What that looks like for us is a library of systems ready to respond to any market condition — and a focus on improving our ability to select the systems that are “in-phase dynamically”. The secret isn’t predicting the future, but responding faster — and more reliably — to changing environments.

    From a business perspective, this means being willing to adapt to and adopt new technologies without losing sight of a bigger ‘why,’ as we discussed in this article.

    A Practical Example

    When we first wrote about this, one of Capitalogix’s advisors wrote back to confirm their understanding of the coin-flipping analogy.

    The odds of flipping a coin and getting heads 25 times in a row is roughly 1-in-33 million. So if we have 33 million flippers and 100 get 25 heads in a row, statistically that is very improbable.  We can deduce that group of 100 is a combination of some lucky flippers, but also that some have a "flipping edge."  We may not be able to say which is which, but as a group our 100 will still consistently provide an edge in future flip-offs.

    Well, that is correct. If we were developing coin-flipping agents, that would be as far as we could go. However, we are in luck because our trading “problem” has an extra dimension, which makes it possible to filter out some of the “lucky” trading systems.

    Determining Which are the Best Systems.

    There are several ways to determine whether a trading system has a persistent edge. For example, we can examine the market returns during the trading period and compare them with the trading results. This is significant because many systems have either a long or short bias. That means even if a system does not have an edge, it would be more likely to turn a profit when its bias aligns with the market. You can try to correct that bias using math and statistical magic to determine whether the system has a predictive edge. It Is a Lot Simpler Than It Sounds.

    Imagine a system that picks trades based on a roulette spin. Instead of numbers or colors, the wheel is filled with “Go Long” and “Go Short” selections. As long as the choices are balanced, the system is random. But what if the roulette wheel had more opportunities for “long” selections than “short” selections?

    Article content

    This random system would appear to be “in-phase” whenever the market is in an uptrend. But does it have an edge?

    One Way To Calculate Whether You Have An Edge.

    Let’s say that you test a particular trading system on hourly bars of the S&P 500 Index from January 2000 until today.

    1. The first thing you need is the total net profit of the system for all its trades.
    2. The second thing you need to calculate is the percentage of time spent long and short during the test period.
    3. Third, you need to generate a reasonably large population of entirely random entries and exits with the same percentage of long/short times as your back-tested results (this step can be repeated multiple times to create a range of results).
    4. Fourth, use statistical inference to calculate the average profit of these random entry tests for that same test period.
    5. Finally, subtract that amount from the total back-tested net profit from the first step.

    According to the law of large numbers, in the case of the “roulette” system illustrated above, correcting for bias this way, the P&L of random systems would end up close to zero … while systems with real predictive power would be left with significant residual profits after the bias correction. While the math isn’t complicated, the process is still challenging because it requires substantial resources to crunch that many numbers for hundreds of thousands of Bots. Luckily, RAM, CPU cycles, and disk space continue to become cheaper and more powerful.

    If your success can’t be replicated with new data, it may have been luck all along.

    Conclusion: Tipping the Odds In Your Favor

    Anyone can tally a win-loss column; far fewer can tell whether it was smarts, skill, or serendipity that made the difference. This is where rigorous analysis becomes invaluable.

    Obviously, luck and skill affect every aspect of experience (from adopting technology, starting a business, transitioning from a product-based to a platform-based business model, or countless other scenarios).

    In most situations, the secret is to determine what data is relevant to your industry, as well as what data you’re creating. Figure out how to analyze it. Figure out how to do that consistently, autonomously, and efficiently. Then … test.

    It’s not sexy, and it’s not complicated.

    We live in a ready, fire, aim era. The speed of innovation is staggering, and the capital and energy required to create an app or start a business are at an all-time low. A bias for action is powerful.

    Luck and a bias for action will take you further than most – but it still won’t take you far enough.

    If you want to explore this topic further, consider reading “Fooled by Randomness” by Nassim Nicholas Taleb or “Thinking, Fast and Slow” by Daniel Kahneman. Both offer deeper insights into the psychology of luck and skill in markets and life.

    Staying Honest

    To conclude, I’ll leave you with a question…

    If you’re reading this, you’ve almost certainly been lucky and skillful. Take a minute to list at least one thing you attribute to luck — and one to skill — in your career and life. With that in mind, what could you do differently in the future to tip the odds in your favor?

    Try this, too: Next time you celebrate a big win, ask: Did I make my own luck, or did I simply wait for it to strike? In the end, the real edge belongs to those who learn to prepare, adapt — and still stay humble enough to know when fortune lent a hand.

  • A Look At The $127 Trillion Global Stock Market

    The world’s stock markets are more intertwined and unpredictable than ever. As we step into 2025, the landscape is dominated by record highs, emerging uncertainties, and shifting regional dynamics. What forces are redrawing the map—and how should forward-looking investors respond?

    Here is a look at global stock markets. Worldwide, they represented $127 trillion in value in 2024, with U.S. markets accounting for nearly half of that amount. 

     

    20250831 Global-Stock-Market_VC_Terzo_Main

    via visualcapitalist

    Global Market Snapshot

    For comparison, the global market has grown over 14% since 2023, when its value was approximately $111 trillion.

    U.S. Dominance vs. Global Opportunity. While U.S. markets account for nearly half of the global value, it’s striking how far behind China and the EU lag. It is worth examining why … and what may lie ahead.

    Regional Comparisons

    Let’s consider how other major regions are faring.

    China’s stock market growth remains sluggish, held back by cautious consumers and the unpredictability of shifting government policies. The EU’s performance declined slightly in 2024, and faces headwinds from high interest rates and shifting energy dynamics. Meanwhile, emerging markets show wide variation—technology-driven countries outperform, while others lag due to policy or global uncertainty. 

    Here is a slightly deeper look at each.

    China: Stimulus and Uncertainty. China’s government is attempting to stimulate its economy by reducing interest rates, repurchasing stocks, and increasing spending. That sounds positive, but people are still spending less, houses aren’t selling well, and the government often changes rules unexpectedly. Most regular Chinese don’t own stocks. For global investors, China is an intriguing yet risky market — one where outside forces frequently cause sudden shifts.

    Europe: Value Amid Headwinds. Europe’s economy is diverse—its markets are a mix of banks, factories, and some technology. Wages are rising, and governments are spending. Sounds positive, but factors such as higher interest rates and global events continue to hinder progress. As a result, European stocks are generally cheaper than U.S. stocks, almost like a “value menu.” For investors, Europe remains a "safe harbor" steady option that can help balance out a portfolio, but don’t expect fireworks unless a few key factors break in their favor.

    Emerging Markets: Technology’s Outliers. Meanwhile, emerging markets are more complex and susceptible to the influence of changing factors. Some countries, such as Taiwan and South Korea, are thriving thanks to strong technology growth. Others, such as Russia and Brazil, face challenges due to limited investment and instability. These markets are volatile, offering both high risk and potentially high reward..

    Takeaways for Investors

    The global market’s leadership is not set in stone; it is a rolling contest shaped by policy, innovation, and disruption. For investors and strategists, now is the time to reexamine assumptions, rebalance risks, and prepare for whatever comes next. In this era of constant change, adaptability—not allegiance—will be the source of enduring advantage.

    Savvy investors spread their bets, recognizing that overconcentration in any single market can amplify both gains and risks.

    For all the varied fears in Americans’ minds, U.S. dominance is driven not only by the strength of tech giants, but also by resilient consumer sectors and deep capital markets that set global standards. 

    As a result, America’s share of the global market increased approximately 7% over the past year, while China’s share has remained stable, and the EU’s share has declined slightly. 

    The good news for U.S investors is that global market capitalization is rising, and so is our share of it.

    It’s easy to find reasons to be afraid or tentative … but it’s just as easy to find reasons to take confident action.

    Looking ahead, rising interest rates, geopolitical tensions, and new technology breakthroughs could all shift the balance of global market leadership. So could the growth of digital assets. Investors must consider what will happen next if these trends continue (or suddenly reverse).

    Policy shifts in China or the EU could spark sudden capital flows, triggering domino effects that shape the next phase of market evolution.

    Market leadership can change in an instant. In this climate, agility wins. Prepare, diversify, and stay alert—because in the world of investing, standing still is the biggest risk of all.

    History has shown that the most prosperous periods are those that encourage creative destruction and reinvention.

    You can't predict the future, but you can prepare for it.

  • Foreign Direct Investments

    Against a backdrop of economic uncertainty, supply chain upheaval, and rapid technological transformation, foreign direct investment remains a bellwether of global confidence and strategic priorities.

    Looking back to 2024, the patterns of FDI offer a window into what the world’s investors value most—and what new risks and opportunities are on the horizon.

    In a rapidly shifting global landscape, investors are constantly on the hunt for both opportunity and resilience. Which sectors and regions captured the lion’s share of foreign direct investment in 2024—and what fueled these evolving priorities?

    The Global State of FDI in 2024

    Visual Capitalist created an infographic that shows Foreign Investors allocated more than $1 trillion across the top 10 global sectors in 2024, highlighting the scope and realignment of worldwide capital movements.

     

    This infographic visualizes the top 10 sectors for foreign direct investment (FDI) in 2024, based on global data for over 17,000 FDI projects.

    via visualcapitalist

    Sector Standouts: Winners and Surprises

    Now let’s zoom into specific industries.

    Renewable energy topped the list, drawing $270.1 billion in FDI. Even so, renewable energy FDI declined — mainly due to rising material costs, tougher regulations, and delayed projects. Despite these setbacks, long-term prospects in renewables are robust.

    Perhaps the most surprising winner of 2024, the communications sector not only rebounded but grew by an astonishing 84%, far outpacing previous years. This likely reflects accelerated 5G rollouts and infrastructure expansions in both developed and emerging markets.

    Semiconductors followed closely, likely reflecting the growing infrastructure requirements of global reliance on AI.

    Notably, FDI in real estate increased despite a critical labor shortage, sparking questions about how investment is responding to workforce constraints.

    Meanwhile, traditional manufacturing showed minimal growth, as investors appear wary of ongoing supply chain disruptions and increasing automation across the industry.

    Regional Focus: Asia’s Rise & India’s Transformation

    Regionally, the FDI tide was far from even. Asia emerged as the dominant destination for FDI. While India, alone, attracted investment across more than 1,000 distinct projects, driven by robust economic reforms and a burgeoning market.

    What’s Next? 

    FDI patterns are not static reflections but dynamic forecasts of the next big global moves. Consequently, geopolitics and regulatory shifts impact FDI as well.

    As global investment patterns continue to evolve, the next wave of foreign direct investment will likely redefine which strategies (and which regions) lead. Will emerging trends hold, or will new surprises shift the map again next year?”

    Where would you bet global capital will go next?

  • The History of Technology …

    We are living through the fastest period of technological change in history — a fact that demands not just awareness, but active engagement. Here’s how to recognize this shift, and what you can do to succeed in it.

    Our ancestors survived by thinking locally and linearly. Yet today, this mindset often leaves us struggling to anticipate the sweeping, unpredictable effects of technology.

    To predict the future of technology, you must understand where we are and where we are headed … but it also helps to recognize how far we’ve come—and how quickly things are now accelerating.

    A Timeline of Human Innovation – From Stone Tools to AI

    Our World In Data put together a great chart that shows the entire history of humanity in relation to innovation. It shows how fast we are moving by telling the story with milestones.

     Longterm-timeline-of-technology

    Max Roser via ourworldindata

    Innovation isn’t only driven by scientists. It’s driven by people like you or me having a vision and making it into a reality. 

    To see just how far we’ve come — and how quickly things now change — let’s look at some milestones.

    3.4 million years ago, our ancestors supposedly started using tools. 2.4 million years later, they harnessed fire. Forty-three thousand years ago (almost a million years later), we developed the first instrument, a flute. 

    Why Speed Matters

    The innovations we just discussed happened over an astonishing expanse of time. Compare that to this: In 1903, the Wright Brothers first took flight … and just 66 years later, we were on the moon. That’s less than a blink in the history of humankind, and yet our knowledge, technologies, and capabilities are expanding exponentially. 

    Acceleration Is The New Normal

    Technology was like a snowball gathering speed, but it’s become an avalanche—hurtling forward, accelerated by AI. Here are some fun facts to back that up.

    • ChatGPT’s Explosive Growth: In 2025, OpenAI’s ChatGPT will hit 700 million weekly active users—a fourfold increase over the previous year. In its first year, ChatGPT reached 100 million monthly active users in just two months, a milestone that took Instagram 2.5 years.

     

    Yesterday’s stable footing guarantees nothing; you must constantly adjust or get swept away.

    While AI dominates headlines, the same story of acceleration is unfolding in fields like biotechnology, climate tech, and robotics. It’s happening everywhere all at once. From nanotechnologies to longevity and age reversal, and from construction to space exploration … exponential change is becoming a constant.

    Turning Information into Actions – What To Do Now

    Though I lead an AI company, I’m not an engineer or a data scientist — I am a strategist. My role is to envision bigger futures, communicate them clearly, and leverage tools that free me to create greater value. Ultimately, that’s going to become everybody’s job.

    I don’t believe that AI will replace people like us quickly, but common sense tells us that people who use AI more effectively might replace us faster than we’d like.

    Start by experimenting with new AI tools. When was the last time you tried a new tool or technology? Even though our company works on AI every day, I’ve challenged myself to continually expand my ability to use AI to create the things I want.

    You’ll probably find that the things you want most are just outside your current comfort zone — or you’d already have them.

    The next level of impact and value lies just beyond your current habits—comfort is the enemy of reinvention.

    A good start is to think about what routine task you could automate next week.

    Leaders must move from certainty-seeking to rapid experimentation. Encourage nimble, high-frequency experimentation with emerging tech.

    Focus on skillsets that complement, not compete with, automation. And vice versa, focus on automation that complements (rather than competes with) unique abilities.

    Share your learnings with your team or community. Set the expectation of progress, and make regular sharing and reporting part of your process. Reward the sharing of learnings over the accumulation of dead knowledge.

    Prepare teams not only technologically, but culturally and psychologically, for relentless reinvention.

    Brene Brown, a noted leadership expert, says, “Vulnerability is the birthplace of innovation, creativity, and change.”

    Don’t let perfectionism hold you back. You don’t need to know every destination before boarding the train; what matters is that you get on. Waiting too long is no longer safe—the train is leaving, and the cost of inaction is climbing.

    Success now means hopping on and adapting while in motion—not waiting for all the answers.

    Onwards!

  • The Most Common Words In Each Religion …

    The World seems very “Us” versus “Them”…  But are we really that different?

    The six largest religions in the world are Christianity, Islam, Judaism, Hinduism, Buddhism, and Sikhism. 

    If you stripped away doctrine, what patterns might emerge in the world’s great sacred texts?

    Similarity in Diversity.

    We often think about the differences between religions. However, a deep review of their sacred texts shows striking similarities (and may be indications of a more integral “truth”).

    Below is a word cloud for each of those religions based on their primary religious text. A word cloud is a visual map of language where the size and boldness of a word reflect its frequency in the text. In this case, the image spotlights the most frequent words across different religious texts (e.g., Jewish Bible, Christian New Testament, Quran, Hindu Vedas, Buddhist Tripitaka, Sikh Guru Granth Sahib).

    Each panel highlights high-frequency terms like Lord, God, man, people, Israel, Indra, Agni, Allah, fortunate, Guru, etc., with the most frequently used words appearing larger and bolder. A visualization, like this, makes it easy to identify the recurring themes or focal points of each tradition.

    So, here is a closer look at what a word cloud of the world’s religions reveals if we strip away doctrine and focus only on frequency. 

     

    Q04t0id427v61

    teddyterminal via Reddit

    On one level, this post explores both the similarities and limits of religious texts via word clouds.

    As historian Yuval Harari notes, “Humans think in terms of stories, not statistics.” Those word clouds are the beginnings of narratives that go beyond the numbers. For example, shared words don’t mean shared values. The word ‘love’ in one tradition may imply obedience, while in another it means self-transcendence.

    The Power and Pitfalls of Translation

    Likewise, translating sacred texts into English makes them more accessible, but can distort meaning and nuance. As an illustration, if you noticed the name “Keith” at the bottom of the Hinduism word cloud, it’s because that was the translator’s name. You might also have seen the word “car” in the Hinduism cloud, that is not an anachronism or prophecy… it is just another old-fashioned word for “chariot”.

    It’s also worth acknowledging that this word cloud is from the English translations, so some words that may mean slightly different things in other languages can be all translated to one word in English. For example, it’s very common in Biblical Hebrew to see different words translated into the same English word. Examples include Khata, Avon, and Pesha – three different “ways of committing a wrong” that may all be translated to the same English word.

    Distortions like these occur across many texts and cultures. In other words, similarities in word usage do not always reflect shared values. Recognizing this helps us navigate between the boundaries of certainty and uncertainty.

    This brings to mind an ancient parable …

    The Parable of Perspectives – Lessons from the Elephant

    I’ve always loved the parable of the blind men and the elephant. While there are many versions, here’s broadly how it goes:

    A group of blind men heard that a strange animal, called an elephant, had been brought to the town, but none of them were aware of its shape and form. Out of curiosity, they said: "We must inspect and know it by touch, of which we are capable". So, they sought it out, and when they found it they groped about it. The first person, whose hand landed on the trunk, said, "This being is like a thick snake". For another one whose hand reached its ear, it seemed like a kind of fan. As for another person, whose hand was upon its leg, said, the elephant is a pillar like a tree-trunk. The blind man who placed his hand upon its side said the elephant, "is a wall". Another who felt its tail, described it as a rope. The last felt its tusk, stating the elephant is that which is hard, smooth and like a spear. 

    This parable highlights that even when everyone is “blind” to the whole truth, each perspective still holds real insight. Recognizing that partial views are still valuable can drive innovative, integrative thinking.

    The blind men and the elephant parable also reminds us of the limitations of individual perspectives and the value of integrating multiple viewpoints. Interestingly, that integration is one of the things large language models are best at … and helping humans access a perspective of perspectives might be a step towards enlightenment.

    Future societies may see it as obvious that synthesizing perspectives (religious, cultural, strategic) can be done by advanced AI at scale, transforming how we resolve complex disputes.

    Hope that helps.

    Oh, and as a thought experiment … What would the word cloud of your own guiding beliefs look like?

  • BlackRock’s Meteoric Rise …

    I don’t usually write about individual companies, but an infographic highlighting BlackRock’s impressive growth caught my eye.

    BlackRock has been around since 1988. It wasn’t until the early 2000s that it really took off, but since then, they’ve clearly been doing something right. 

    Now, they are the world’s largest asset manager.

     

    📈 BlackRock’s Assets Under Management Soar to $12.5 Trillion in Q2 2025

    Voronoi via visualcapitalist

    In 2006, BlackRock acquired Merrill Lynch Investment Managers, nearly doubling its AUM, but its CAGR shows that it’s not just luck that has helped BlackRock achieve its current position. 

    In 2023, when I reviewed their equity holdings, they held approximately $9 trillion in assets. Now that has grown to more than $12 trillion. 

    While they aren’t as transparent as Berkshire Hathaway about what they do or how they do it, according to its website, BlackRock positions itself as a systematic investor that leverages vast datasets and new technologies.

    Comparing again to Berkshire Hathaway, both have invested heavily in Apple, which isn’t particularly surprising. 

    While I enjoy insights into other investors' playbooks, it’s not the be-all and end-all. It’s simply one way to invest … and might be a reasonable way to get from a lot of money to even more money – but their trading strategy isn’t necessarily going to work for the average investor (or you). 

    Still, when there is blood in the streets … asking, “What would Warren or Blackrock do?” might be a great place to start.

    However, it is challenging to maintain an edge if you use the same process and data as your competitors (especially when they have enough assets to use time or trade size to their advantage).

    As the flywheels of commerce spin faster, edges will emerge and decay faster than ever before. Finding a solution is only a step in an ongoing process.  

    Robust, reliable, and repeatable innovation at scale is a meaningful competitive advantage. That implies that idea factories will become as important (if not more so) than factories that produce material products. Likewise, innovation funnels will become more important than sales funnels. 

    The world changes at the speed of thought … and as technology continues to improve … even faster.

    Thankfully, we live in interesting times.

  • The Future of Biohacking

    Today’s my birthday. I woke up on the right side of the dirt, in America, grateful for the opportunities ahead. 

    So far, so good.

    For me, birthdays also invite a moment to pause and reflect on where I am, where I want to go, and what it’ll take to get there.

    On the health front, I’m reminded of a simple truth: A healthy person has a thousand dreams, while an unhealthy one has only one.

    Thankfully, I still have many dreams.

    We’re lucky to be born late enough in human history that medicine isn’t just about fixing what’s broken—it’s about regeneration and life extension. The real promise isn’t just living longer, but living well longer.

    That’s a future worth investing in.

    So today, I’m dusting off some notes from a meeting I had years ago—lessons that feel more relevant than ever.

    A Chat With The Father of Biohacking  

    In 2018, I was in Alaska at Steamboat Bay for a CEO retreat. I was spending time with a friend, Dave Asprey, a successful serial entrepreneur, author of several great books, and a thought leader in biohacking. In many ways, he’s the father of modern biohacking. 

    We recorded a video where Dave did a great job of relating his world to the world of Capitalogix and trading. I share it in part so you can experience his wide range of interests and expertise. It holds up well. I encourage you to watch it.

     

    Via YouTube.

    In the video, Dave explains that life evolves through a series of algorithms operating at microscopic levels. Your body and brain are made of tiny parts working like clever little computers. These parts constantly talk to each other, sense what’s happening around them, and change their behavior to keep you alive and thriving.

    Nature has been running this amazing program for billions of years, constantly improving through trial and error (that’s evolution).

    Dave points out that there are striking similarities between genetics/epigenetics and modern digital algorithms. Markets and businesses make numerous small decisions and adjustments to achieve significant outcomes.

    In a sense, Markets and industries function like biological environments where algorithms continuously evolve and adapt.

    So really, life and business aren’t magic—they’re just lots of tiny choices happening at once. If you learn how to listen to these choices and guide them wisely, you become better at playing the game. And that’s how evolution, biology, and even markets all tie together.
     
    The lesson? Build systems and habits that are flexible and adaptable, like living things.

    It helped me reframe my perspective on my business. But it also got me thinking more about my health and how I wanted the next 20 years of my life to look. As a result, I started taking care of my health and paying more attention to preventive care. 

    Health is the foundation that gives all ambitions a place to stand.

    Focusing on the positive is important, but extending your healthy lifespan starts by being honest with yourself and identifying what you and your body struggle with the most.

    A doctor friend gave me some advice. He said it doesn’t matter if you’re on top of 9 out of 10 things; it’s the 10th that kills you.

    The goal isn’t just to stay alive longer; it’s to live life to its fullest for as long as possible.

    I recently joined a fantastic mastermind group called DaVinci 50, run by Lisa and Richard Rossi. It brings together a remarkable collection of medical professionals and entrepreneurs focused on the latest research, treatments, and opportunities in health and longevity.

    Another great tool I rely on is Advanced Body Scan. Early detection is crucial, but so is tracking the history of your scans to monitor changes over time. In my opinion, the most valuable scan is always the next one.

    Additionally, I utilize a growing list of trackers and biometric devices to monitor my heart rate, along with various apps and tools for mindfulness, breathwork, and journaling. It is essential to recognize that the mind, body, and spirit work together to shape how you live your life.

    Where Biohacking Fits In 

    It’s not surprising that biohacking has become as popular as it has. In a society that encourages (and perhaps even necessitates) an impossible balance between work, responsibilities, and self-care, it makes sense to want to increase efficiency and effectiveness. 

    Biohacking helps you do more with less. Biohacking is popular because it promises to help you achieve peak performance via the path of least resistance.

    Having trouble with sleep, but don’t want to stop using your phone before bed? Wear blue-light blocking glasses. 

    Not getting enough results at the gym? Work out “smarter,” not harder, by using cryotechnology and intelligent lifting machines. 

    While biohacking started as tricks like that – nootropics to help your mind, light and sound machines to decrease stress – it’s becoming increasingly tech-centric and augmentation-based. 

    In Sweden, thousands of Swedes are having microchips inserted under their skin to speed up their daily routines. They use chips to open locked doors, store contact information, and access the train. 

    The Future of Biohacking

    Long-term, it’s likely you’ll see it moving toward exoskeletons, AR/XR experiences, and, unsurprisingly, sex toys. It’s also being used to create artificial organs and counteract memory loss. Companies leading this movement are Neuralink,  Biohax International, and Digiwell. While it’s currently being adopted primarily by fast movers and technocrats, it’s pragmatic to think that more widely adopted versions of this will emerge as technology becomes standardized and protections are put in place. 

    For all the excitement, it’s necessary to remain skeptical and patient. DIY biohacking raises several ethical concerns, particularly regarding data protection and cybersecurity. As a reminder, when it comes to cybersecurity, you, the user, are the biggest weakness.

    There’s no stopping this train, but there’s still time to ensure it stays on track.

    If you’re looking to get started, here’s an hour-long conversation with Dave Asprey about his favorite optimizations. 

    Here’s to having a thousand dreams, leveraging the best of today’s medical advances, and investing not just in years added, but quality within those years.

    Onwards!

  • Digesting a Bigger Future

    We live in a world where technology changes quickly and often, while human nature remains relatively unchanged.

    For most of us, human nature is the key variable.

    I suspect Henry Ford focused on that when he said, "Whether you think you can or you think you can't. You're right."

    Henry Ford Quote - Whether You Think You Can

    Processing the possibilities of tomorrow is often difficult for humans. Part of the problem is that we're wired to think locally and linearly. It's a monumental task for us to comprehend exponential growth, let alone its implications. For example, consider what happened to seemingly smart and forward-looking companies like Kodak, Blockbuster, and RadioShack. 

     

    The world changes quickly.

    Change is constant. The wheels of innovation and commerce spin ever-faster (whether you're ready for it or not). 

    As a practical matter, it means that you get to choose between the shorter-term pain of trying to keep up … or the longer-term pain of being left behind. Said another way, you have to choose between chaos and nothing. 

    It's hard to keep up – and even harder to stay ahead.

    Personally, I went from being one of the youngest and most tech-savvy people in the room to a not-so-young person close to losing their early-adopter beanie. Sometimes it almost seems like my kids expect me to ask them to set my VCR so it stops flashing 12:00 AM all day.

    Def5094d723b4c099755173bc6b580ad

    My company may not be doing "rocket science", but it's pretty close. We utilize exponential technologies, such as high-performance computing, AI, and machine learning, to amplify intelligence and make data-driven, evidence-based decisions in real-time, all the time. 

    But, as we get "techier," I get less so … and my role gets less technical, over time, too.

    Due to my age, experience, and tendency to be a pioneer, I've been battling technology for decades. 

    Don't get me wrong, technology has always been my friend, and I still love it. But my relationship with it is different now.

    I recognize that there are things that change and things that stay the same. And for me, the things that "stay the same" tend to be more important.

    Paradoxically, the part of me that stays the same can still change and grow – that is how you become more (and a more evolved version) of that thing.

     

    The Bigger Picture

    My father said that not worrying about all the little details helped him see the bigger picture and focus on what was possible.

    You don't have to focus on the technological details to predict its progress. Anticipating what people will need is a great predictor of what will get built.   That means predicting "what" is often easier than predicting 'how'.

    Why is that often the case? Because technology that solves a problem is more profitable and popular than technology searching for a problem to solve.

    Here's a video from 1974 of Arthur C. Clarke making some remarkably accurate predictions about the future of technology. 

     

    via Australian Broadcasting Corporation

    Artificial Intelligence, quantum computing, augmented reality, neuro-interfaces, and a host of exponential technologies are going to change the face and nature of our lives (and perhaps life itself). Some of these technologies have become inevitabilities … but what they enable is virtually limitless.

    Where do you see this going?

    Onwards.

  • When Worlds Collide: Timeless Wisdom & Evolutionary Technology in Trading with Matthew Piepenburg

    Back in 2020, I had a Zoom meeting with Matthew Piepenburg of Signals Matter. Of course, being the height of the Pandemic, it was over Zoom. Even though it was a private discussion, there was so much value in our discussion that we decided to share parts of it here. 

    While Matt's understanding of markets is based on Macro/Value investing, we use advanced AI and quantitative methods for our approach. 

    As you might expect, there are a lot of differences in how we view the world, decision-making, and the current market environment. Nonetheless, we share a lot of common beliefs as well.   

    Our talk explores several interesting areas and concepts. I encourage you to watch it below. 

     

    Via YouTube.

    To summarize a couple of the key points, markets are not the economy, and normal market dynamics have been out the window for a long time. In addition, part of why you're seeing increased volatility and noise is that there are so many interventions and artificial inputs to our market system.

    While Matt and I may approach the world with very different lenses, we both believe in "timeless wisdom". 

    Ask yourself, What was true yesterday, today, and will stay true tomorrow? 

    That is part of the reason we focus on emerging technologies and constant innovation … they remain relevant. 

    Something we can both agree on is that if you don't know what your edge is … you don't have one. 

     

    If You Don't Know What Your Edge Is You Don't Have One _GapingVoid

    Hope you enjoyed the video.

    Let me know what other topics you'd like to hear more about. 

    Onwards!

  • The Benner Cycle: How Not To Predict Markets

    When I first became interested in trading, I would often consult many traditional sources and old-school market wisdom.  I particularly liked the Stock Trader's Almanac. 

    While there is real wisdom in some of those sources, most might as well be horoscopes or Nostradamus-level predictions.  Throw enough darts, and one of them might hit the bullseye. 

    Still, it seems better than using astrology to trade. 

    Want something easy to predict?  Traders love patterns … from the simple head-and-shoulders to Fibonacci sequences and the Elliot Wave Theory.

    Here's an example from Samuel Benner, an Ohio farmer, in 1875.  That year, he released a book titled "Benners Prophecies: Future Ups and Downs in Prices," and in it, he shared a now relatively famous chart called the Benner Cycle.  Some claim that it's been accurately predicting the ups and downs of the market for over 100 years.  Let's check it out. 

     

     

    Here's what it does get right … markets go up, and then they go down … and that cycle continues.  Consequently, if you want to make money, you should buy low and sell high … It's hard to call that a competitive advantage.

    Mostly, you're looking at vague predictions with +/- 2-year error bars on a 10-year cycle. 

    However, it was close to the dot-com bust and the 2008 crash, so even if you sold a little early, you'd have been reasonably happy with your decision to follow the cycle.

    The truth is that we use cycle analysis in our live trading models.  However, it is a lot more rigorous and scientific than the Benner Cycle.  The trick is figuring out what to focus on—and what to ignore. 

    Just as humans are good at seeing patterns where there are none … they tend to see cycles that aren't anything but coincidences. 

    This is a reminder that just because an AI chat service recommends something, it doesn't make it a good recommendation.  Those models do some things well.  Making scientific or mathematically rigorous market predictions probably isn't the area to trust ChatGPT or one of its rivals … yet. 

    We're seeing bots improve at running businesses and writing code, but off-the-shelf tools like ChatGPT are still known for generating hallucinations and overconfidence. 

    Be careful out there.