Isn't it unnerving that an event with 3% probability is 26% likely to happen at least one time out of ten?
Do something that rare—and 3% seems very rare right??—ten times a day and you're encountering it twice a week.
Kind of freaky.
“Fischer Black thought that #markets got the right price within a factor of two about 90 per cent of the time… I knew Fischer pretty well, and he didn’t throw numbers like those around lightly; he thought long and hard about them, even though they sound like the kind of rough figures other people would come up with quickly. We argued quite a bit about them, and I pushed for ‘within a factor of two about half the time’.” —Aaron Brown
*Financial Risk Management for Dummies* chapter 4 = 🔥
“Taking less risk than is optimal is not safer; it just locks in a worse outcome. In competitive fields, doing less than the best often means failing completely. Taking more risk than is optimal also results in a worse outcome, and often leads to complete disaster.”
—Aaron Brown, “Red-Blooded Risk”
Ideas I frequently invoke:
- Philip Guo on silent technical privilege http://pgbovine.net/tech-privilege.htm
- Bryn Hammond on silenced history https://amgalant.com/
- Duncan Watts on cumulative advantage, or, MusicLab, in the top ten scientific experiments ever https://www.nytimes.com/2007/04/15/magazine/15wwlnidealab.t.html
- AnimeFeminist for their critiques and season guides https://www.animefeminist.com/
(Don't link to this toot, it'll be edited+deleted, but it'll be pinned to my profile on Octodon.social.)
Another unrelated founder was much more compelling: kept a balanced team, equal split between product, design, and engineering. And the engineers always pair programmed, used TDD, and had CI/CD. Amazing! I liked that team a lot!
Something a founder actually told a roomful of engineers:
“I was a salesman my whole career. When I hired my first engineer, we couldn’t have been more polar opposites. I had always thought that if you spoke well and communicated clearly, that you were good. But then I read a book!, and learned that that’s not true—and that the opposite is often true.”
When someone asked what book, “I didn’t actually read it” and talked about #Blinkist, the fifteen-minute audio book summarizers.
(For the record, it's entirely possible that all the major factor-based smart-beta ETFs and funds are executing such similar strategies, and together have so much money, that they're having a pricing impact.)
A reasonable question is, when the present goes outside your historic dataset, what do you do? That's the real challenge, and seems to happen at least once a lifetime 😒
How do you come up with any investing thesis? You ask "is X better than Y over the entirety of my data?" If yes, then do X, set Y=X, and look for new X.
The Vanguard/Bogle breakthrough of the 1970s said that passive investing is better than active investing.
Factor-based investing has been shown to be better than passive investing.
Nobody said these approaches wouldn't have long periods of bad returns. A risky world means you have lean years and fat years—all strategies have 💩 periods.
Even more cringeworthy: saying some factor or other has been performing poorly over some time horizon so its time has come, e.g., this rando about the momentum factor:
“Its volatility also came to the fore when the strategy posted the largest one-day crash in a decade last September… The investing style has struggled since.” https://finance.yahoo.com/news/one-quant-smoking-gun-prove-131232335.html
This is a mistake so elementary it makes me doubt my sanity. Factors work because for long stretches of time they don’t. They’re hard to stick to.
Hearing all the bleating about coronavirus in the headlines seeking to explain the four-day 7.5% US stock market tumble and shaking my head.
After a dry summer, with the forest ready to catch on fire, the headlines all speculated about the careless camper who accidentally started the blaze. No doubt he was drinking Corona.
But the absurd headlines aren’t stopping me from enjoying the volatility!!! Happy crashing to everyone!
Also I have a #Pandas question https://stackoverflow.com/questions/60386664/modifying-a-dataframe-after-two-uses-of-loc
tech drama what else
For years I've blocked #StackOverflow's "hot network questions"—in AdBlock Origin, via
in blocklist. This blocks the list of sometimes interesting, sometimes awful, always time-wasting questions on all their networks.
Today I also blocked their side-bar, so I don't see blog or "Featured on Meta" content:
The drama due to Stack Overflow distancing itself from gross people, and then unjustly firing someone, is 😪.
Apparently all this time at least one child had been thinking that Saruman was a monkey wizard. #SecondLanguageWoes
“ Counterintuitive as it may seem, the more specific the work is, the harder it can be to estimate. That’s because making the interface just so can require solving hidden complexities and implementation details that weren’t visible in the mockup. When the scope isn’t variable, the team can’t reconsider a design decision that is turning out to cost more than it’s worth.”
Curious about this #Basecamp book on their software methodology, it’s interesting so far!
“the mathematics you learn at most high schools is actually quite different from what you're exposed to at the university level. The focus turns from being about rote computation to logic, deduction, and reasoning.” https://www.neilwithdata.com/mathematics-self-learner
I emphasize the name “calculation” now, after realizing that grade school and even much of undergrad “math” is robotic rules-application under pressure.
(Even my calculus class asked me to prove convergence of series (real math!) in a 45-minute exam 😓.)
@22 I dug into that rabbit hole with LibreOffice Calc once, apparently it is all to support sheets that rely on bugs in Excel.
Never mind, one of them fled ten minutes in, unable to handle the thought of family pet dying and then failing the entire season.
Opened a million-row CSV file in Numbers and—
"Tables in Nubmers can't support more than 65,535 rows. Some content was not imported" why tho?
(Analyzing the free options history data from http://www.historicaloptiondata.com/content/free-data, not sure what hashtag #FinanceFediverse use for this kind of thing)
but where the heck are these? Any Spotify users in North America found them?
Steve Klabnik elucidating software developers‘ incoherent views on unionizing.
Rando #1: “something something unions are considered a class marker”
Rando #2: “Demonstrably false: Rust has unions but no classes.”
Programmer in the big city 💎🌇. Tries to maintain privacy, and yet see how these toots flow.
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