Where is the surprise?quants cover more territory

Friday, March 22, 2019 Francisco 0 Comments

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I see no surprise that the quants will do much better than the discretionary managers. To collect small coins and small fruit nothing better than a machine.

if there is a crisis a new 2008 a big event a whale nothing better than a man with his eyes wide open.


Computers help quants cover more territory. “Diversification means that if you can apply the same idea in many places, as opposed to doing it in one place, you will get smoother returns,” says Ilmanen.
Institutional Investor



From The Mathmatical Investor
Majority of highest-earning hedge fund managers and traders are at quant firms

Manager	Rank	2017 earnings	Company	Type: Q* or D*
Jim Simons	1	$1.6 B	Renaissance Technologies Corp.	Q
Michael Platt	2	$1.2 B	BlueCrest Capital Management	D
Ray Dalio	3	$870 M	Bridgewater Associates	Q
Ken Griffin	4	$870 M	Citadel LLC	Q
John Overdeck	5	$700 M	Two Sigma Investments	Q
David Siegel	5	$700 M	Two Sigma Investments	Q
Israel Englander	7	$500 M	Millennium Management	Q
Paul Tudor Jones II	7	$500 M	Tudor Investment Corporation	D
David Shaw	7	$500 M	D.E. Shaw & Co., L.P.	Q
Jeffrey Talpins	7	$500 M	Element Capital Management	D
Carl Icahn	11	$480 M	Icahn Capital Management	D
Chase Coleman III	12	$450 M	Tiger Global Management	D
Alan Howard	13	$300 M	Brevan Howard Asset Management	D
Crispin Oley	14	$200 M	Odey Asset Management	D
Greg Jensen	15	$150 M	Bridgewater Associates	Q
Peter Muller	15	$150 M	PDT Partners	Q
Robert Prince	15	$150 M	Bridgewater Associates	Q
Steven Schonfeld	18	$130 M	Schonfeld Group	Q
Peter Brown	19	$100 M	Renaissance Technologies Corp.	Q
Paul Singer	19	$100 M	Elliott Management	D

Children Are Grown, but Parenting Doesn’t Stop........................

Wednesday, March 20, 2019 Francisco 0 Comments

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If kids see their parents cutting corners or even cheating (god forbid) what is the use of sending kids to the best colleges. Just be a decent parent that is enough. If you have no money even better.


From The NYT:

Bribing SAT proctors. Fabricating students’ athletic credentials. Paying off college officials. The actions that some wealthy parents were charged with Tuesday — to secure their children a spot at elite colleges — are illegal and scandalous. But they’re part of a broader pattern, albeit on the extreme end of the continuum: parents’ willingness to do anything it takes to help their grown children succeed. 

Ideas vs stuff

Monday, March 18, 2019 Francisco 0 Comments

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Thus, in addition to Marx’s three factors of production (land, labor and capital) a fourth factor should be added: knowledge. This has, in fact, been a game changer as the world no longer belongs to those who can mobilize the traditional factors of production, but to those who have “knowledge”. This can be seen in the outperformance of growth (knowledge) stocks versus value (asset heavy) stocks. Or the superior performance of the US economy, whose main comparative advantage is its ability to mobilize, and retain, knowledge.

Louis Gave

this is the reason why there are less and less wars in the world. why conquer a country if their factories are worth zero? In the past there was regions that were strategic now nothing is strategic besides attracting the best in numbers. yes the USA attracts the best in size.

japan everywhere !

Saturday, March 16, 2019 Francisco 0 Comments

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Wash your kids hands often!

Thursday, March 14, 2019 Francisco 0 Comments

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The idea that let my kids have all sorts of diseases because they will get immunity is not a good strategy........................Avoid being sick is the best advice. I had this idea for another reason, perhaps medications can have some unintended side effects. Avoid medication as much as possible.




From BCA research

Better health undoubtedly helped as well. Early childhood diseases reduce IQ by diverting the body’s
resources away from mental development towards fighting off infections. There is a strong correlation between measured IQ and disease burden across countries.

IQ is very important but there is something even more.........

Thursday, March 14, 2019 Francisco 0 Comments

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From The Great BCA Research

Why IQ Matters
IQ has a long and contentious history. Yet, despite numerous efforts to jettison the concept, it
has endured for one simple reason: It has more predictive power than virtually anything else in
the psychological realm. A simple 30-minute IQ test can help predict future educational attainment,
job performance, income, health, criminality, and fertility choices IQ even predicts trader performance!!



 the most important thing to have success is to want badly to have success

“Your vision of where or who you want to be is the greatest asset you have. Without having a goal it’s difficult to score.” 
― Paul Arden, It's Not How Good You Are, It's How Good You Want To Be

Sleep has two side benefits.....

Sunday, March 10, 2019 Francisco 0 Comments

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1. Makes you feel hungry even if you are full. Sleep loss has been shown to affect the secretion of cortisol, a hormone that regulates appetite. As a result, individuals who lose sleep may continue to feel hungry despite adequate food intake.
2. Increases fat storage. Sleep loss may interfere with the body's ability to metabolize carbohydrates, which leads to high levels of blood sugar. Excess blood sugar promotes the overproduction of insulin, which can lead to the storage of body fat and insulin resistance, a critical step into the development of diabetes.

You have no control, so what can we do...............

Thursday, March 07, 2019 Francisco 0 Comments

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From The Guardian

Peterson’s worldview is complex, although 12 Rules makes a heroic attempt to simplify it into digestible material. It might be encapsulated thus: “Life is tragic. You are tiny and flawed and ignorant and weak and everything else is huge, complex and overwhelming. Once, we had Christianity as a bulwark against that terrifying reality. But God died. Since then the defence has either been ideology – most notably Marxism or fascism – or nihilism. These lead, and have led in the 20th century, to catastrophe.

“‘Happiness’ is a pointless goal. Don’t compare yourself with other people, compare yourself with who you were yesterday. No one gets away with anything, ever, so take responsibility for your own life. You conjure your own world, not only metaphorically but also literally and neurologically. These lessons are what the great stories and myths have been telling us since civilization began.”


I think Jordan Peterson has a point, life is suffering . If you have expectations, if you think you are in control you have a problem, life can give you some surprises and you would be shocked! yes everything is possible. If you don't accept that anything is possible you will suffer.

                                                                         
 "If only we'd stop trying to be happy we'd have a pretty good time."

 Edith Wharton

I bought this book in Thailand recently i am not yet here but it's a decent proposal


So, understand your situation from a greater perspective. Don't think that what s happening to you is unfair or unjustified; what is happening to you at all the times is just what should be happening.

Ajahn Sumano Bhikkhu

we hope Trump fails

Wednesday, March 06, 2019 Francisco 0 Comments

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From Wikipedia

the European Union will go the way of the Soviet Union............

Wednesday, March 06, 2019 Francisco 0 Comments

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Europe is sleepwalking into oblivion and its people need to wake up before it is too late. If they don’t, the European Union will go the way of the Soviet Union in 1991. Neither our leaders nor ordinary citizens seem to understand that we are experiencing a revolutionary moment, that the range of possibilities is very broad, and that the eventual outcome is thus highly uncertain.

++George SOROS in The Guardian 2019

In my country Portugal there is a saying that states that if there is no bread much screaming and no reasoning

In Europe there is no growth there is no prospects for the children to live better than the parents (i don't agree with this i believe kids have a wonderful life) and above all there is no jobs in some countries and plenty in other counties.

I think the culprit is too much state. To much intervention too much regulation too much bureaucracy 

20 years after the Euro started cars are being build almost exclusively in Germany. 20 years ago Italians had car manufacturers , France etc... Now the best country doing cars is moving closely to produce all the cars. Germany. 

Is it possible with the single currency that the best place to produce ZYX is going to produce all XYZ??? YES

 the solution is immigration to Germany in engineering and immigration to Portugal if you want to drive a Tuk Tuk in Lisbon or table serve the millions of tourists arriving in Lisbon to see the Torre de Belém. Yes the solution is let people move in Europe. 


Stock markets can be volatile and subject to extremes, but over time they’ve
provided an excellent measure of overall economic health. Since the beginning of 2009, the cumulative 10-year performance of equities in the eurozone has laggedthat in the U.S. by 40%.

A Gary Shilling

This can't be a surprise !

Wednesday, March 06, 2019 Francisco 0 Comments

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Some Europe is near a recession. No surprise here.

How to make money from this information since banks already halved in anticipation?

Europe works like this

No growth
less tax receipts
Fixed Government expenses (or Growing like in Portugal)
Government increase taxes or new taxes on everything
less growth
people dissatisfied
government spends more money to calm the voters
No growth because the Government multiplier is below 1

In the US from time to time Trump,  Bush Senior and Reagan cut taxes big time. In Europe no government ever cuts taxes.


How to play Europe?

yes you got it. short banks even if they are very cheap

Does Having a Plan B Sabotage Your Plan A? yes

Monday, March 04, 2019 Francisco 0 Comments

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You can't have a plan B if you want to succeed



Why? Because when you have no Plan B, guess what?  Plan A has to work. 


Focus is a key to do well in everything, focus focus focus. being a specialist doing just one thing and that is only possible if you are all in. No Plan B please.



A recent research study (Shin and Milkman, 2016) revealed the dangers and risks of having a “Plan B" when you truly want your “Plan A” to succeed. The researchers found that once you begin thinking about a fallback plan, your desire to achieve your ultimate goal decreases.

Why does the stock market generally always tend to go up?

Friday, March 01, 2019 Francisco 0 Comments

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The stock market does not always go up, make no mistake about it.

Markets in general are not moving up always. they move in cycles.

Why people think that the stock market always go up?

a)Because companies don't distribute all their profits, so like a zero coupon it goes up naturally because they store a bit of profits every year.
b)With growing labor force (more hands) GDP & profits have been growing in the 20 century
c)Since we measure the market with the stock indexes and the stock indexes accept companies that are doing well and expel companies that are doing poorly naturally with a rule like that you always win.

In countries that are not many companies waiting to enter the stock indexes the process i described in c) does not materialize. In Europe there are not enough candidates, some indexes like Portugal PSI 20 don't even have 20 companies that the name PSI20 suggest. In those cases things can get nasty for a long time. The all time high in Portugal was established at 13384 in 2007 now trades at 5200 points.

So my advice is the following


a)Never think that investing is a science, it's not it's a game with some rules but no a science
b)Anything is possible
c)Be flexible
d)Don't have a philosophy unless the Philosophy is not having one
e)just do like the indexes do more of what is doing well and get out like the plague of what is not working
Finally be an optimist because life is better.