Web/Tech

  • Fintech, AI & Analytics – My Webinar with IBM

    Back in June, I participated in a series of webinars for IBM. The focus was on building smart and secure financial services. My talk, specifically, was on advanced computing and the new world of trading. Challenging times drive advancement – and what better time to talk about advancements in technology (and their applications) than in the midst of a global pandemic. 

    You can watch a replay of the Fintech webinar here. There are several interesting presentations.  If you just want to watch my presentation, it starts at the 5:16 mark.

    In addition, I've uploaded a different version of just my talk that you can watch directly here.

     

     

    In the past. trading used to be about people trading with people. Markets represented the collective fear and greed of populations. So price patterns and other technical analysis measures really represented the collective fear and greed of a population. If you could capture that data and figure out certain statistical probabilities, you might have had an edge. The keywords is "might have". 

    If you had more information than your competitors – an information asymmetry – you had an amazing edge. At one time that was being able to print out reports on stocks from that new-fangled technology called the internet. As time passed, it became harder and harder to gain an asymmetric information advantage. 

    The rules, the players, and the game have all changed. Today, technological asymmetry is a major factor, and your edges come from things like bigger and faster servers and low latency connections to markets.

    In the future, I see those edges combining as artificial intelligence starts to leverage exponential technologies and new data sources (like alternative data and metadata feedback loops). It is easy to imagine a time when information is the fuel, but your ability to digest and parse that information is the engine. 

    I talk about much more in the video but boiling down the main points,  ask yourself (in business, in trading, in life) are you separating the signal from the noise?

    Expect Increased Volatility and Noise_GapingVoid

    A technological advantage doesn't mean anything if you're plugging in inaccurate or biased data into it. 

    We've talked about it over the past few weeks with the never-ending news cycle – but it's a lesson that's infinitely applicable. 

    Onwards! 

  • Let’s Play: News Segment or Propaganda Piece?

    There is nothing wrong with your television.  We will control all that you see and hear. We can deluge you with a thousand channels or expand one single image to crystal clarity and beyond. We can shape your vision to anything our imagination can conceive.  Enjoy ….

     

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    The original,, from The Outer Limits TV show was: 

    There is nothing wrong with your television set. Do not attempt to adjust the picture. We are controlling transmission. If we wish to make it louder, we will bring up the volume. If we wish to make it softer, we will tune it to a whisper. We will control the horizontal. We will control the vertical. We can roll the image; make it flutter. We can change the focus to a soft blur or sharpen it to crystal clarity. For the next hour, sit quietly and we will control all that you see and hear. We repeat: there is nothing wrong with your television set. You are about to participate in a great adventure. You are about to experience the awe and mystery which reaches from the inner mind to the outer limits.

    As a society, we're fairly vulnerable to groupthink, advertisements, and confirmation bias. 

    We believe what we want to believe, so it can be very hard to change a belief, even in the face of contrary evidence. 

    Recently, we've seen a massive uptick in distrust toward news agencies, big companies, the government, and basically anyone with a particularly large reach. 

    To a certain degree, this is understandable and justified. Here is an example of the power of the media focused on a message.  Click to watch.

     

    via Courier News

    Propaganda has always been an issue, and almost everyone does it; governments, companies, etc. Luckily, it's easier to see today than in the past, but unluckily it's also more pervasive and insidious than before. 

    It's to the point where if you watch the news you're misinformed, and if you don't watch the news you're uninformed. 

    The above segment portrays a rosy picture of Amazon's efforts to protect its workers while delivering essentials to the struggling homebound masses. This comes while Amazon has come under massive fire for removing some of its protections. 

    Honestly, I use Amazon and, in my opinion, this isn't a massive breach of trust. News stations have a lot of time to fill, they often have sponsored content.

    That being said, it's something to be cognizant of – not necessarily offended by.

    Personally, I believe I am reasonably aware and somewhat immune from propaganda. That probably isn't as true as I'd like to believe.

    It used to be true that winners wrote history (think empires, wars, etc.). Now, the one that delivers the most broadcast narratives shapes the emotional and seemingly logical responses to what we perceive to be happening around us.

    The result impacts elections, financial markets, buying choices, and countless other areas of our life. 

    As A.I., Bots, and social media grow, our ability to discern truth from 'truthiness' weakens.

    It's a great reminder that what you're seeing and hearing is carefully manufactured, and hopefully, it encourages you to get outside your bubble. 

  • The Pace of Success

    Capitalogix started in my home.  The first employee sat at a tiny desk behind me.  Their job was to exit the trades I entered.  This was an early attempt to avoid the fear, greed, and discretionary mistakes that humans bring to the business of trading.

    We started to grow … and somehow got to 23 people working in my home.  It literally overtook my office, dining room, and the entire upstairs. Neighbors noticed (and expressed their displeasure).

    Looking back, it seems crazy (and my wife seems Saintly).  But somehow, at the time, it felt natural. 

    Incubating the company in my home, and growing it the way we did resulted in a closeness (a feeling much like family) that pays dividends, even today.

    Speed matters … both fast and slow.  

    I shot a video on the subject. Check it out. 

     

     

    There is a concept in business expressed by the phrase "measure twice and cut once."  It's much easier to do something the right way from the beginning rather than trying to fix it after you mess it up. 

    It saves time and creates a better end result. 

    Beginning with the end in mind is powerful.  I often spend what looks like "too much" time imagining the bigger future.  What will things look like when we are ten-times bigger?  Who will we serve?  What dangers will keep me up at night?  What opportunities will we be trying to attract or capture?  What strengths will give us confidence?  Who will we be collaborating with … and about what?  It helps build a roadmap that makes it easier to understand whether particular activities are aligned with our future (or just something we are doing now). 

    I prefer to optimize on the longer-term rather than the shorter-term.  That isn't always possible or practical … but when it is, that is my preference.

    Pace is important – and a focus on "what's the best next step" is an important driver at Capitalogix, but sometimes in order to go fast, you have to go slow. You may miss out on something, but the ultimate payoff is often worth it. 

    It's a good lesson for personal growth as well.  There is no right timeline. No one size fits all.  Take your time. Find your path. 

    DQKRk6pWAAMtoQiAnna Vital via Adioma

    Hope that helps. 

  • The Intelligent Investor

    There are many different methods of investing – and I've experimented with quite a few of them (fundamental, technical, statistical, quantitative, machine learning, etc.).

    Ultimately, I believe most trading techniques work until they don't. 

    I don't believe that any technique always works … but I do believe that there is always something that works. 

    Likewise, I believe that there is always a best next step.

    Evolutionarily, the strongest or smartest doesn't necessarily survive … The quickest to adapt and adjust to its changing environment is the one that gains advantage.

    Consequently, it makes sense to be on the lookout for sources of new learning (even if they are old).

    In the same way that reading news from an opposing slant can inform your decision – studying other beliefs may help you find the underlying truths (or spark the insight you needed).

    Warren Buffet is a famous value investor. He does immense research on companies, attempts to buy them at a discount and then hold on to them for long periods of time.  On some levels, our approach to the markets is radically different.  On the other hand, it would be crazy to ignore the brilliance of what he "knows" and what he does.

    One of his favorite books on investing is titled The Intelligent Investor by Benjamin Graham. It's a great introduction to the basics of value investing (versus speculating) and the role of inflation, margin of safety, etc. 

    It's worth a read … but if you want to watch a good summary, here's a six-minute video. 

     

    via Financial Freedom

    If you aren't learning, you're dying.

  • Here Are Some Links For Your Weekly Reading – June 28th, 2020

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

    Lighter Links:

     

    Trading Links:

  • A Look At the Highest-Valued Startups in the World

    Statista put together a list of the ten highest-valued unicorn startups in the world based on numbers from CBInsights. To see more information on these startups, click here. 

    A unicorn startup is a private company with a valuation of over $1 billion. As of June 2020, there are more than 400 unicorns around the world. Variants include a decacorn, valued at over $10 billion, and, soon, a hectocorn, valued at over $100 billion.

     

    19317via Statista

    China had the two highest-valued startups on the list.  Both the U.S. and China each have four companies on the list of the ten highest-valued startups. The U.S. companies are easily recognizable – Stripe, SpaceX, Airbnb, and Epic Games. The Chinese companies may have slipped under your radar (but they would probably be easily recognizable to you if you lived in China). 

    1. Bytedance uses machine learning to tailor newsfeeds for users on various platforms, including Toutiao in China and TikTok in the US. In May, Disney's head of streaming came on as CEO of TikTok and COO of Bytedance.
    2. DiDi Chuxing provides various app-based transportation, including taxis, on-demand services, bikes, and more. They're a competitor to Uber and Lyft that has dominated the Asian market and is using AI to optimize dispatch and route planning for its services.
    3. Kuaishou is a video sharing app with over 200 million active daily users. It has unusually strong support from users outside of "tier 1" cities and has received massive support from multimedia conglomerate Tencent.
    4. DJI Innovations is (by a large margin) the world leader in drones and quadcopters, accounting for over 70% of the civilian market. They're also used extensively by militaries, police forces, and even terrorist groups. 

    According to CB Insights, there are more than 400 unicorn startups (companies valued at US$1 billion or more) in the world as of May 2020.  Meanwhile, 24 of the companies in the ranking were valued at US$10 billion or more. 

    The top 10 list of decacorns also includes Indian e-commerce platform PayTM and Singaporean ride-hailing app Grab. Further down the list, UK data center provider Global Switch (rank 19), Indonesia’s answer to WeChat, umbrella app Go-Jek (rank 20), Brazilian fintech provider Nubank (rank 21) and a second player from India, hotel startup Oyo (rank 22), make appearances.

  • Generations of Fathers

    Happy Father's Day!

    Both of my children are adults now. It's strange to consider them fully-functioning autonomous adults – because I remember their childhood like it was yesterday (like worrying whether the soft spot on their heads would ever fill in and harden up, or if they'd ever stop sleeping with a nightlight). 

    Today, they're men doing great things,  and I get to be proud of them.  I also get to be proud of my role in their growth and proud of passing down the wisdom of my dad, and his father, and the rest who came before me. 

    It has been 20 years since my father died … Crazy how time flies! He was my best friend and an amazing mentor. His vision for what I could become helped shape and inform my goals, my accomplishments, and yes, me.

    For example, after winning the State Championship in the shot put, my dad came down from the stands onto the field.  He hugged me and told me that he knew I could do it. Then, he looked deeply into my eyes and asked whether I was a little disappointed?  "Disappointed?" I asked. "But, Dad, I won."  He looked at me and said, "Winning is great … but you didn't throw a personal best."   He was proud, and he loved me.   He recognized that winning was important … but he wanted to remind me that the other throwers weren't my real competition.  

    In life, to be and do your best, the competition is really with yourself; and we both knew I could do better.

    My Dad believed in setting high standards.  He taught me that most people's lives are defined by their minimum standards.  Why?  Because once those standards get met, it is easy to get distracted and complacent.

    One of his favorite sayings was, "The difference between good and great is infinitesimal."  This applies to many things. For example, people who are good take advantage of opportunities; people who are great create them. 

    As time goes on, I recognize how much of my Dad is in me. And, likewise, how much his father was a part of him … and how parts of all of us have somehow become a part of my children. 

     

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    Me, my dad, and grandfather

    My Impact on My Children

    I hope I've imparted many important lessons to my children – but one of the most impactful lessons was teaching them to enjoy reading. 

    Some parents try to limit the amount of time their kids spend watching TV or playing video games. I tried something different.  Instead, my kids earned their games by reading books. And, they also received more books in the process. 

    Here's how it worked. 

    When they finished a book, it was their right, and my obligation, to take them to the bookstore for us to pick up the next book together. Likewise, when they finished ten books, it was their right, and my obligation, to take them to the computer store or game store for them to choose any game they wanted.

    When they finished a hundred books, they earned a game system. 

    There came a point when I wanted one of my sons to start reading grown-up books. He was comfortably reading a particular genre (teen fiction) and didn't want to read the kind of books that I thought he was ready to read (and might enjoy more).  So, I created a bonus system that counted a specific book (it might have been a Tom Clancy novel) as three books.  I didn't force him; I just let the easier path to a reward "whisper" in his ear what to read. Once he finished that, he never went back to teen fiction.

    As they started to get into their teenage years, I needed to up the ante a little. So, 500 books meant they got a laptop of their choice. Both boys cashed in and probably felt like they were taking advantage of their dad.

    So, Who Got the Better Bargain?

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    Three generations of Getsons

    Fortunately, in child-rearing, everyone can win. My sons love reading to this day – and have learned that they can accomplish anything they set their minds to… one step at a time. 

    My sons weren't ever forced to stop watching TV, or read a certain type of book, and always had endless things to keep them entertained. 

    Win-win. 

    I like to think each generation becomes better (as people and parents) due to the cumulative experience of the generations that came before them. 

    We stand on the shoulders of giants. 

    I look forward to seeing how my (eventual) grandchildren turn out, and how little pieces of me and their great-grandfather show up. 

    Hope you had a great weekend.

  • Here Are Some Links For Your Weekly Reading – June 7th, 2020

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

    Lighter Links:

    Trading Links:

  • Are You A Maverick Or A Heretic?

    I have a tents problem. I keep buying tents, but I never go camping. Just kidding – I don’t own a tent. I have a tense problem – because I’m so excited about the future and what’s possible that I sometimes lose track of what’s been actualized "in real life" already.

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    Once I’ve thought it, it becomes real for me. Once I’ve figured it out and told it to someone … on some level, it's already done. And, I’m probably moving on to the next idea or challenge in my head (like: And what would that make possible?).

    I think this is common among (to use a Kolbe term) Quick Starts. I love being around entrepreneurs because a lot of them are Quick Starts, and they share this future-focused perspective. The problem, however, is that when you say something’s possible that hasn’t been proven yet, the average person responds with “no it’s not.”

    I’ve seen the pattern over and over, both in my own company and in my friend’s companies. At my company, we have a lot of data scientists – and they’re almost all naturally pessimistic. Which makes sense; if you were going to hire a personality type to be a scientist, you’d want someone who didn’t believe their hypothesis until they’ve proven it. It’s the right personality for the job, but it doesn’t mean they’re right, and it certainly doesn’t mean that approach is right for the visionaries.

    I’m not telling everyone to be visionaries. What I am saying is, if you’re naturally a visionary, feel free to embrace it, but surround yourself with people who keep you grounded in reality. We’d never have innovation if it wasn’t for you, and innovators wouldn’t ever get anything done if it wasn’t for other personality types.

    Information Is Beautiful put together an interactive list of famous ideas rejected that were later proven correct. You can filter by industry – Astronomy, Biology, Engineering, Mathematics, Medicine, Physical Sciences – and by other factors like how long the originator was a pariah, how they were treated due to their idea, and when the idea was formally adopted. Click to see the interactive version. 

    Screen Shot 2020-04-12 at 10.25.14 AMvia Information Is Beautiful

    In 895, Al-Razi believing a fever was a natural defense mechanism got him beaten.

    In 1592, Giordano Bruno believing the Sun was one of many stars got him killed. Shortly after, Galileo Galilei was imprisoned for believing the earth wasn’t the center of the solar system.

    Losing some of the stakes, in 1884 and 1903 respectively, Nikola Tesla and the Wright Brothers were ignored and rejected for their technological innovations.

    Even today you can see the initial response to visionaries like Peter Diamandis or Elon Musk.

    The status quo is comfortable, but if you’re standing still you’re moving backward.

    Are you a maverick or a heretic? You won’t know until you see it to the end. You may experience failures, but that’s the experience for your next endeavor.

    "I have not failed. I've just found 10,000 ways that won't work." – Thomas Edison

    Onwards!

  • Here Are Some Links For Your Weekly Reading – May 31st, 2020

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

    Lighter Links:

    Trading Links: