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.


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…

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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

Engineer’s Guide to Stock Options

January 6, 2014

Check out this informative guide on stock options by Alex Maccaw. He goes over possible scenarios and their tax consequences. 

UPS Deliveries as a Leading Market Indicator

December 30, 2013

Elaine's Idle Mind

UPS's Quarterly Earnings Rise 48 Percent

Other than this current year, UPS has historically been quite decent at predicting seasonal shipping volume. But is seasonal shipping volume good at predicting other things? Let’s find out.

Here we have UPS’s average US daily volume by quarter and the year-over-year change. Every year, during Q4, delivery numbers jump due to holiday shipping.

ups avg daily volume

The last data point for 2013 Q4 is made up by me — In a late-October press release, UPS predicted that daily volume would increase by 8% this year. The fact that package volume exceeded their shipping capacity over the holidays implies that the daily volume in fact increased by more than 8%. Let’s guess, I don’t know, 8.5%.

And now we have the UPS year-over-year percentage change overlaid with the S&P500 year-over-year percentage change. UPS quarterly data points are shown as x’s because the data are less frequent.

sp500 vs ups

The S&P500 is quite a…

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