Trading Tools

  • Visualizing the Global Economy

    I've recently been spending more time with economists, while we're not always on the same page when it comes to the interplay with trading, I still find economics interesting. 

    Trump's impact on global trade and politics will also be interesting to quantify. 

    Take a look at the world economy divided by region (Mexico is part of Latin America for the sake of this graphic). 

     

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    Some thoughts: 

    • Russia probably has the biggest disparity between GDP and land mass.
    • This doesn't tell us anything about economic growth, would be interesting to compare this five years ago, and five years from now.  
    • Global GDP isn't zero-sum, so this circle can theoretically grow.
    • Top 3 economies were the U.S., China, and then Japan (with a large drop between each economy).
    • The top 4 countries account for over 50% of GDP.

    It will be interesting to see the way Trump's tariffs will affect the world. There are potentially hundreds of billions in annual revenue that would be affected. 

     

     

  • Here Are Some Links For Your Weekly Reading – November 4th, 2018

    Reminder: election day is this Tuesday. 

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

    Lighter Links  

     

  • Is the Market Sell-off Going to Continue?

    October has been tough on equity markets this year. 

    For example, the S&P 500 opened to a sea of red this past early last week.

     

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    McDonald's was one of the few green spots on that heat map.  Which reminds me, Mickey D's is becoming a little more modern by adding online and touchscreen ordering.

    For some context, the S&P is on pace for it's worst sell-off since 2010 … while the NASDAQ hasn't been hit like this since post-Lehman in 2008. 

    Is it a correction or a blip?

    Historically, midterm elections inspire uncertainty among investors that dissipates quickly as soon as they're over. Once that uncertainty is resolved, the S&P gains an average of 31% the following year.

    Markets exist to trade … and confusion is a primary catalyst.  As such, many people believe the market will rally … while others believe that the traditional midterm effect could be blunted. 

    For all the confusion in today's society, it's good to see that some things don't change.

    Onwards.

  • Farm Tank Podcast – AI Trading, The Cowboys & Pablo Escobar

    I was recently on Jordan Van Trump's Farm Tank podcast. 

    On the podcast, we talked about artificial intelligence & trading, the Cowboys, my trip to Columbia, and a bunch of other things. 

    Worth a listen. Check it out. 

    Screen Shot 2018-10-19 at 2.47.23 PM

    Here are some highlights:

    • "You have to really enjoy the people you do business with. It's important to know who's fun to be around, who's going to be a net add, who's going to create energy, and who's going to have ideas." (5:55)
    • "I had a computer. Back then, only secretaries typed. I had a lot of people telling me it looked bad for a lawyer to have a computer, but I loved it and pretty quickly it became a competitive advantage." (15:20)
    • "One of the most important business lessons I learned is you have to understand what you want. So much of what I see in business is people telling me what they don't want." (19:00)
    • "I found that 10 times better is often easier to achieve than 10% better. If you're going for a 10% change, then you're bringing the past forward and you're trying to figure out what you can adjust." (20:00)
    • "Learning and growing are huge. For me, it's about raising the standard, getting comfortable with being uncomfortable, seeing the bigger picture, and creating breakthroughs. In order to do that I surround myself with people who think differently." (22:45)
    • "There's a difference between good and great and that difference is infinitesimal. You have to find not only what you're excellent at, but also what gives you energy because every day you fight the good fight and compete with everybody else."(58:00)

     

    I'll be at The Van Trump conference, in Kansas City, on November 28th. Hope to see you there.

  • The World’s 20 Largest Tech Giants

    Today, the technology universe is more uniform than you'd think.  All of the top 20 technology companies are based in America and China.

    Since 2013, China has added 5 to their side and America has lost 1. 

    Here is the list.

     

    Visualizing The World's 20 Largest Tech Giants

    via Visual Capitalist

    It's also interesting to note that there's a steep dropoff between the "giants" and the companies lower down the ladder. There isn't a single company with a valuation between $200 billion and $450 billion. 

    To put it in a different perspective, here's a pie chart showing the market capitalization of the top 5 tech companies in comparison to the bottom 282 S&P 500 companies. 

     

    via Michael Batnick

    It can be hard for a tech company to break into the upper echelons.  However, with tech, change is the only constant. 

    What are some of the companies you think have a chance to enter the realm of these giants?

  • Entrepreneur Weekly Podcast – AI and the Futures Industry

    You are the average of the five people you spend the most time with.  ~ Jim Rohn

     

    2Surrounding yourself with the right people, and joining peer groups like Strategic Coach, Genius Network, Vistage, or the Entrepreneurs' Organization is vital to your growth. They bring together brilliant minds and industry transformers together in forums focused on innovation, creative disruption, and possibility. 

    Peer groups help you set (and raise) standards. They help bring new capabilities, but also new possibilities, new found energies and a reconnection to your purpose, mission, and values. 

    If you're not ready for that commitment, listening to podcasts from those people that have done what you want to do and gone where you want to go is a great step towards reaching those same goals.

    In that vein, I recently went to Alaska with some friends.  While there, I got to be on Entrepreneur Weekly with some of my close friends from Genius Network.

    The following podcast features me and these guys:

     

    The entire episode is less than 39 minutes. My piece starts around the 11:30 mark and goes for about 5 minutes.  I open with a pretty big claim … Check it out! 

     

    Pursue Passionately 

     

    If you understand what you really want and if you focus on that, rather than what you don’t want or all the things that are wrong; as long as you’re moving in that direction, and you don’t give up,  the result is inevitable.  ~ Howard Getson

     

    When I was a kid, I couldn't imagine being where I am today … nor could I imagine the path that took me here. 

    Looking back, it all makes sense. I didn't always know where I was going … but I was passionate about business, and I was driven towards a greater purpose.  From selling painted sand terrariums at the farmer's market to building an artificial intelligence powered hedge fund there's a common thread and a driving force. 

    Don't be afraid to take the risks that may injure your present to make way for your future. 

     

    The Fourth Industrial Revolution

     

    The advent of AI is going to be as dramatic for society as the invention of electricity.  ~ Howard Getson

     

    Artificial intelligence will solve problems and create opportunities on a scope and scale that is beyond our current comprehension. 

    I was lucky to be in the right place at the right time to build this company and capitalize on this opportunity.  Realize, however, that I had to recognize the vision before there was an opportunity to capture. 

    Life is about making your future bigger than your past.  There are plenty of opportunities out there if you know what you want.

    Let me know what you are passionate about.  I'd love to help.

  • Understanding the Scope and Scale of Humanity (and Our Impact)

    "Progress is the attraction that moves humanity." ~ Marcus Garvey

    Human expansion and development is without precedent. We're in an entirely new territory. People could "only imagine" many of the things we take for granted today. 

    To put it in perspective. 

    Updated-world-population-growth-1750-2100-768x538via OurWorldInData

    While growth is slowing down, and we're reaching carrying capacity, the population is still on the rise.

     

    Technology is Growing Exponentially 

     

    “Technology goes beyond mere tool making; it is a process of creating ever more powerful technology using the tools from the previous round of innovation.” ~Ray Kurzweil

     

    The only thing that's perhaps more impressive than our population growth is our technological growth. For the first ~ 64,000 years of humanity, we relied upon the verbal transfer of information. The creation of writing and the formal recording of knowledge was the tinder for a blaze of progress.

     

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    The above graph stops in 1990, and it's almost hard to quantify the growth since then.  Nonetheless, Moore's Law does a good job of adding some context (even if it is coming to an end). 

    Moore's law is the observation that the number of transistors in a dense integrated circuit doubles about every two years. Extrapolated outwards, we can expect more technologies to evolve every two years, if not faster. 

    Information is the fuel for so much of human progress and it most embodies the future to me. We create more data today than in all of history and digest more data today than ever before.

     

    As our ability to parse information increases … so do our capabilities. 

     

    History is defined by asymmetric information, but our future may not be.  The growth in information creation and digestion – I believe -  will have massive effects on how we congregate, what we create, and how we interact with each other and the corporate world around us. 

    I can't begin to imagine what my children's children will have at their disposal. 

    What's the coolest future-tech you expect to see in your lifetime?

  • A Rennaissance in Mathematics: The Mathematician Who Cracked Wall Street

    Jim Simons is a mathematician and cryptographer who realized that the complex math he used to break codes could help explain financial patterns – and he made billions because of it in his notoriously secretive hedge fund firm called Renaissance Technologies. 

    He is famous not only for the duration of his success and the size of his results … but also for the way he made his money (with much lower volatility and risk than his peers and competitors). 

    His background is impressive.  Simons taught at Harvard and MIT and worked with the NSA.  Here is a video where he shares some thoughts in a 2015 TED talk interview.  It's worth a watch. 

     

    TED via Youtube

    Interesting stuff … I hope you got something from it. 

    Despite advanced math still being a mystery to many,  most rely on it more than ever … for example, look at what we're seeing with the growth of machine learning and AI.

     

    The Heart of AI is Still in Humans

     

    Simons built a team of mathematicians whose motivation was doing exciting mathematics and science (rather than hired guns who could be lured away by money).

    That doesn't mean money wasn't a motivator, but it hits on something important. 

    The heart of good math and good AI will always benefit from the quality of the humans around it. You still have to champion integrity, culture, and purpose.

     

    Better Math as a Competitive Advantage

     

    We stayed ahead of the pack by finding other approaches and shorter-term approaches to some extent … but the real thing was to gather a tremendous amount of data – Jim Simons

     

    If you've been to our office, or heard me speak, you know how important I believe those ideas are to continuing prosperity. 

    Constant innovation on a massive scope and scale create more ways to win.

    Onwards!

     

  • Here Are Some Links For Your Weekly Reading, September 2nd, 2018

     

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

    Lighter Links  

     

     

  • AI, Investing v. Trading, Algorithms, and more at Camp Kotok.

    Last month, I attended Camp Kotok, a private gathering of economists, fund managers, and other financial industry professionals. 

    The mood was cautiously optimistic to bullish about the markets – while the participants were feeling a bit uneasy due to changes in the financial industry due to advanced technologies. 

    Cumberland Advisors just released a video of me talking with Bob Eisenbeis – their Vice Chairman & Chief Monetary Economist. 

    Check it out. 

     

    Cumberland Advisors via YouTube

    AI is removing the fear, greed, and discretionary mistakes from financial decision making and its power is in removing the human fully from that process. 

    We’re at the beginning of a cycle of progress that is hard to imagine … and easy to underestimate.

    Ultimately, I think AI will transform the planet much like electricity did.  

    What about you?