qm

to students who are looking to break into quant trading but have no internship this summer, I highly recommend this elite program. as we all know trading is more or less similar to fighting in the streets of Kabul. I’m very close to the hiring manager so DM for more details

@AgustinLebron3 this is true btw. the lab is called YCombinator look it up

@macrocephalopod Brother this is a totally insane way to talk about asset management. It's a job. There does not need to be "something socially wrong with you" to do a job. You just turn up and do the job and then you go home.

Being a trader is a combination of a chess grandmaster, a professional boxer, and a WW2 soldier storming the beaches on D-Day. There are long periods of sitting around while fuck all happens, you're going to suffer brain damage, and you're almost certainly going to get blown up.

quant brainteaser: Anprotic released a new AI model Bafle - Tymhos with safeguards. time goes by, and no major disaster happened caused by the model. which one is more likely: 1) Tymhos had no groundbreaking capabilities in the first place 2) Safeguards were well designed

@the_delta_dog wow an account created solely to ask me about ridge regression 3 features is small, so it’s unlikely regularisation choice is the issue here. my guess your issues are probs i) bad feature/target engineering ii) features are not as predictive as you thought they were

spent a week studying ridge regressions. up 3 hours before work today trying to learn and build an intuition in practice. used 3 features i know are predictive. trained many models, only to learn nothing and get terrible r2. unbelievable how hard this is to figure out on your own.. @quantymacro tips?

@bagina_enjoyer yeah. back then 3 of us was very tight. Jim was helping the NSA breaking codes, Jay was in the military, and I was one of the founders of Black Panther. good old times

@quantymacro I think I knew the guy, he was ex-military right?

back when I was based in Long Island working for RenTech, we had a super talented quant named Jay first few years he made so much money. that got into his head. he started hosting lavish parties to seduce our HR Daisy. didn’t end well since then Jim only hired married quants

What the fuck did you just fucking say about me, you little bitch? I'll have you know I graduated top of my class at Soly, and I've been involved in numerous commissions on SPX, and I have over 300 confirmed trades. I am trained in tracking error and I'm the top vol seller in the entire US stock market. You are nothing to me but just another counterparty. I will wipe you the fuck out with precision the likes of which has never been seen before on this Earth, mark my fucking words. You think you can get away with saying that shit to me over the Internet? Think again, fucker. As we speak I am contacting my secret network of substacks across the USA and your IP is being traced right now so you better prepare for the storm, maggot. The storm that wipes out the pathetic little thing you call your life. You're fucking dead, kid. I can be anywhere, anytime, and I can outtrade you in over seven hundred ways, and that's just with my manual trading. Not only am I extensively trained in dispersion, but I have access to the entire arsenal of the interactive brokers and I will use it to its full extent to wipe your miserable ass off the face of the continent, you little shit. If only you could have known what unholy retribution your little "clever" comment was about to bring down upon you, maybe you would have held your fucking tongue. But you couldn't, you didn't, and now you're paying the price, you goddamn idiot. I will shit fury all over you and you will drown in it. You're fucking dead, kiddo.

@quantymacro @Notbullnorbear QM is a LARP right

@IDrawCharts out of curiosity would you say you’re back to 100%?

two years ago today it's good to be alive

@AgustinLebron3 gstack, gbrain, gps

Someone name one successful YC hardtech company in the last 10 years. I'll wait.

this is extremely huge because J in JD Vance actually stands for JP Morgan. few people know this. thanks Rick for bringing this to attention

@shguke @HighFreqAsuka let H0 be the hypothesis that she’s trading noise let H1 be the hypothesis that she has info that is accurate, not priced correctly, and has the skills to process those infos into the right trades/expressions to be consistently profitable I’m bad at maths so you tell me

@quantymacro @HighFreqAsuka why do you think so? also more or less her /skill/ is subservient to access to information in this specific case?

Everyone dunking on her is actually wrong. The reality is she had knowledge of the future that wasn't correctly priced. Stocks are very well priced a minute out, they're not as well priced years out.

@HighFreqAsuka sounds plausible but IMO I can’t help but to think the hypothesis of she has no genuine skills is way more likely to be true vs your explanation

@quantymacro There’s subtly here, but the people who followed the scaling laws *were right*, just empirically. And people who are Bay Area adjacent, probably are more likely to be right than average because that’s where we build the future.

@elletwocache send him to YCombinator as a promotion

@AgustinLebron3 onlyfans daughter or effective altruism son?

This prospect is utterly terrifying. A bunch of newly-rich young autists funding whatever parochial non-profit ideas cross their mind? Oh boy. Consider the case of MacKenzie Scott, newly-rich due to marriage/divorce, funding an embarrassing set of grifty political causes.

@macrocephalopod @TheOneLanceB yeah fair. who knows the other 2% could be your family gets shot immediately by AK-47s

@quantymacro @TheOneLanceB I think it makes a pretty big difference what happens in the other 2% of cases.....! Anyone who answers a blanket "yes" without asking about the downside is a shitty trader.

THOUGHTS ON RISK MANAGEMENT I started this discussion to make the point that risk management is far more nuanced than most on Twitter makes it seem. Yes, part of great risk management is having rigid rules, discipline, and structure. But trading is also a game of uncertainty, changing context, and asymmetric opportunity. Not every situation cleanly fits inside a pre-defined box. Good risk management isn’t just about protecting yourself. Good risk management also allows you to maximize pnl while minimizing unacceptable outcomes. For many conservative traders, the biggest weakness in their trading is actually NOT taking enough risk. One needs to recognize that risk is inherent in our job. You can’t make money without it. In fact, many overlooked that sometimes even blowup risk should be an acceptable risk. One question I pushed traders on in this discussion: If you had a trade with a 98% chance of retiring your family forever… but it violated your risk rules… would you take it? Many said no. Personally, I think that for anyone out there grinding, you’d have to be out of your fucking mind not to take that trade. Because the reality is: most traders already have some probability of blowup regardless. No matter what you think, you already probably have a .5% or 1% or 2% chance of blowing up over the course of a career. Plus even if you didn’t, for many over the long run, strategies decay and edge disappear. Many traders will NEVER “beat the game” over a long enough horizon. So if you truly had a massively asymmetric opportunity with overwhelming expected value… are you really going to pass on it because a rulebook said so????? Insanity. At the same time, history is FULL of incredible traders who got overconfident, oversized, and eventually lost everything. So we also can’t fool ourselves into believing we are objective when emotions are involved. In fact, the moments where we most NEED risk management are often the exact moments where we are the least capable of accurately handicapping expected value because we’re tilted, euphoric, desperate, exhausted, or emotionally compromised. IMO, inaccurate handicapping of expected value is the biggest danger of any risk management system in practice. Also… Risk management should always be subservient to goals. That’s why it’s personal. If you have a $1,000 account and you’re young, maybe taking aggressive shots and occasionally blowing up is part of the learning curve. If you’re managing 100% of your family’s net worth, the acceptable risk profile becomes completely different. This is also where wiring out money and keep safe stashes of acorns is a whole other important discussion. There is no universal framework. Only tradeoffs. Many asked me my opinion on these topics. The truth is, I’ve broken risk management rules dozens of times. I’ve taken existential risk dozens of times. Sometimes intentionally so, other times not. Should one be willing to violate their rules? Probably? Should one be willing to take on existential risk? Depends the person. I don’t have the answers, but I do think what is most important is recognizing that good risk management is: 1. Iterative 2. Never perfect. 3. Some level of rule-based. 4. Flexible enough to cover the complexity of trading as @Ksidiii mentioned as well. Perhaps a topic for a future video.

@dc_mma so you’re a quant now, huh?

Guys, I need help on this if you have two people that make a bet on something. For an amount that the other person doesn’t possess. But based on the result of the event in which they believe they will win they make a bet that they don’t necessarily have the money to pay. Are they able to make that bet?

@macrocephalopod @Ksidiii I genuinely think if the finance industry is not a “high paying” industry no one will ever talk like this. somehow the money involved makes people say insane things about the job. but what do I know

@Ksidiii Brother this is a totally insane way to talk about asset management. It's a job. There does not need to be "something socially wrong with you" to do a job. You just turn up and do the job and then you go home.

This game has transformed my life, my family’s life, my friends’ lives, and even the lives of my future grandchildren. For that, I am eternally grateful to God for the success He has given me. At the same time, make no mistake, this game is one of the most cancerous and dangerous in the world. It can ruin and cripple you financially, socially, psychologically, and emotionally in ways you cannot imagine. If you are playing this game at the highest level, not casually investing, you have to be willing and aching to answer its call at every second of the day. And honestly, monetary advancement alone is not enough to keep you in it. Something has to be socially wrong with you to be obsessed in a way that is difficult to even characterize. You have to be obsessed with solving this puzzle every single day. If that is not you, it is probably a better choice to avoid it entirely. Very similar to mishandling an AK-47, small mistakes in this game can be life altering. For my fellow lunatics, another day, and into the fray we go. Blessings and love your way 🫡