Cool Portfolio Charts

September 8, 2015

Very cool:

Portfolio Charts is a completely free resource for exploring passive investing strategies using intuitive charts and real world examples that look beyond the raw numbers. Whether you’re a beginner looking for sample portfolios or a financial adviser seeking sophisticated and unique modeling tools, there’s something here for investors of all types.


Where You Live Correlates to a 20% Investment Bias

June 27, 2015


If you live on the West Coast, near the technology hubs of Silicon Valley, you are very likely to be overweighted in technology by 9.5 percent or so. Live in the Northeast, and you are overexposed to finance by 9 percent. Investors in the industrial Midwest are likely to have 11.8 percent more industrial companies in their portfolio than the rest of the country. The greatest overexposure is in the South, where energy holdings are 13.7 percent above the average.

Some of this overweight might be due to employee stock option plans. After all, Google’s founders, and most of its employees, live in or around Mountain View, California. Their portfolios are likely to be filled with Google shares and/or options. The same is true for JPMorgan and Goldman Sachs in New York and Boston, Exxon Mobil in Texas, and 3M in Minnesota.

Read More: Your Local Investing Bias Could Cost You –bv

The Impact of Derivatives Trading on Bitcoin Spot Market Volatility

April 21, 2015

Elaine's Idle Mind

Screen Shot 2015-04-21 at 9.53.32 AM

Bitcoin fell another 14% against the USD this past month. Or maybe bitcoin held steady as the dollar rallied. Depends what universe you live in.

Last week, Silicon Valley Meets Wall Street panelists theorized that the introduction of derivatives markets would reduce bitcoin price volatility.

Do highly-leveraged bets stabilize their underlying markets?

Options and futures expiration dates see increased trading volume and volatility. Investors have to close out of their positions, sometimes options holders try to push underlying prices in their favor, or some take stock positions to hedge their options exposure.

Enough speculation. Let’s look at historical markets following the introduction of derivatives trading. I read all this shit so you don’t have to.

Markets Effect on volatility Reference
Kuala Lumpur Stock Exchange increase Pok & Poshakwale 2004
Korea Stock Exchange increase Bae, et al 2004
Spanish Stock Market decrease Pilar & Rafael 2002
Italian Stock Exchange decrease Bologna…

View original post 187 more words

Maybe You Shouldn’t Buy What You Know

March 10, 2015

Elaine's Idle Mind

The most popular stocks among young people: Amazon (AMZN), Apple (AAPL), Google (GOOG), Netflix (NFLX), GoPro (GPRO), Alibaba (BABA), Tesla (TSLA), Facebook (FB), LinkedIn (LNKD), Twitter (TWTR), Blackberry (BBRY). Trendy consumer tech stocks.

Stocks with Youngest Median Owners Stocks with Youngest Median Owners

Old people are also buying what they know. That’s why they buy companies that sell life insurance and cancer drugs and sliced cheese.

Stocks with Oldest Median Owners Stocks with Oldest Median Owners

This is what you have to look forward to as an old person. However, here are the stocks charted based on fair value (a combination of P/E, P/S, shareholder value, EBITDA/EV, FCF/EV).

value stocks

Each column represents the decile of a company’s valuation, and the numbers indicate the historical excess return by valuation for the last 50 years.

Old people are buying value stocks…

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Robinhood (part 2): Democratizing Access to the Financial Markets

February 7, 2015

Elaine's Idle Mind


I love that Robinhood allows me to flip stocks on the toilet.

I used to do all my trading through Interactive Brokers, but its secure login system required that I be tethered to a desktop.

With Robinhood, I place orders with a thumb swipe. With a sufficiently volatile stock, I can make or lose a few pennies every time I visit the bathroom, which is about 76 times a day because I have issues.

So cool.


I used to think that maybe the financial markets shouldn’t be quite so democratized, maybe stock-picking should be reserved for sophisticated investors. Who am I kidding? Individual stock traders suck no matter what brokerage we use.

Retail investors like me are dumb. Well maybe you’re a special snowflake who consistently beats the market, but retail investors as a whole are uninformed traders who underperform the market. Wall Street calls us wealthy hobbyists.


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Book of the Week: The Bogleheads’ Guide to Retirement Planning

January 11, 2015

How Does the Power Grid Work?

February 8, 2014

Until the power grid beefs up infrastructure in the midwest where nobody lives, the wind and solar power generated there will be inaccessible for most Americans.