"I know rich people who bot [insert any asset levered] and they play 67 rounds of golf a week now" is a really cool brand of tweet.

Keep em coming, I don't want to forget how garbage our tax code is.
I don't golf but I can only imagine how many convos rich people have around the 9th hole when everyone's had a beer, is nice and loose, and safely politically sorted about how much fiscal stimulus is destroying this country.
Don't worry rich dude, if you've played Monopoly you know that an airdrop of money in the endgame just ends up as a rent check in the mail. Nothing really changes except which rich dude's snapshot holds the crown when the winners split the pot
Ok, feel like I'm good for one of those every 6 months. Sorry but just don't know what lessons are supposed to be celebrated by re-shuffling secondary market investments and taking a snapshot in 2021

I get that people wanna hear about it and that's the point of Twitter to many.

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More from @KrisAbdelmessih

14 Sep
What will a 95th percentile return for single stock be in the next 6 months be?

What if we restrict to optionable? Anyone have a dashboard that can ask:

"5% of names have an N(d2) of at least 3x"

but 3x is a threshold you can move until you capture 5% of the universe
Because it's optionable I think that sets a floor for what the true 95th percentile return will be since the investable universe for this contest is all stocks.

But I presume that at least half the kids won't realize that picking a recognizable name won't cut it....
Meaning the probability that any kid picks a name that finishes in the 95th percentile is probably small.

Using this to think about what range of implied odds to look for in a biotech. A name that has 5x potential is probably unnecessary to strive for but 2x prolly not enuff
Read 4 tweets
11 Sep
Not in the same league, but have a distant relative that owns a bunch of buildings in LA (he lives in a Santa Monica house that was worth $5mm 20 years ago).

When I asked him about anything related to business, he just says Jesus tells him what to buy.

The lesson...
Time machine to the 1970s and start buying everything in CA.

My family considered moving to CA in the late 79s early 80s when I was living in Brooklyn. I was 4 years old when they scouted the Bay Area.

Parents couldn't land a job there. We settled in NJ.
They bought a house for $70k. My mom remembers camping out bc you could get a early bird mortgage for 13% instead if 14% or something like that.

Anyway, that $70k house is only worth about $400k today. Throw 2% RE taxes and it has been an awful financial investment...
Read 5 tweets
7 Sep
A rhetorical product idea

A fintwit-raised dashboard of dashboards (kind of like layouts in Bloomberg/TradingView/Koyfin/Excel etc) where individuals shared:

🌡️their dashboard
🧠the reasoning for what's on it
⏱️the timeframe/decision the metric informs
i say "rhetorical" since it would not make sense for people to contribute to this...but maybe. I think I could have shared every one of my dashboards and what my positions were and i think almost everyone would still f it up...
since the strategies are ultimately discretionary and sizing, gameplan, and relationships are important

But the dashboards themselves are useful base rate starting points esp since they narrow from the infinite
Read 4 tweets
7 Sep
Reading this post and thinking that a "scrub" from the gaming world is the exact definition of investors who care more about being right or what's right than making money.

Read 4 tweets
7 Sep
This is from @ByrneHobart post-mortem of his tuition aka the div futures trade


I appreciated how he qualitatively spells out why shorting stocks as a hedge changed the trade.

(you can also see it as short term structure trade with a fixed near expiry)
A lazy treatment would simply calibrate betas of near and long-dated futures and short a ton of stock since you are long the high-beta short end of the div term structure...but Byrne wasn't lazy about the idea.

He intuitively understands that any calibrated beta is...
...sensitive to the volatile measuring period we were going thru.

So instead, his intuition focuses on what matters. The fact that the beta (which is an input to the hedge ratio) itself is volatile and what the trade really cares about is the slope or rate between...
Read 5 tweets
25 Aug
So the first story of insider trading by using private info to bet on a peer is interesting.

Should it be illegal?

Here's a thought from my market-making days...
Say a broker indicates an interest to buy a slug of call options from a MM in TSM. That mm is restricted from acting on that private info by buying TSM stock or options ahead of the order.

That's not all.
The mm would also be restricted on buying calls on SMH of which TSM is a large weight. So there is a gradient of correlation away from the original order that one could use to "pre-hedge".

Where does the line get drawn?

MM firms get guidance from the SEC on such matters.
Read 8 tweets

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