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Chaikin Analytics Review and Free Trial

July 8th, 2014

One of the biggest hurdles that the individual investor faces in trying to create a nimble, smart portfolio is the competition.

Investment bankers, quants, mutual fund companies, and big Wall Street firms are employing Ph.D. researchers with degrees in everything from finance to physics to create model portfolios. They use the latest and most powerful technology to guide their buys and sells.

The little guy doesn’t have a chance.

That’s what I thought, until last week. George and I had a chance to see a demonstration of Chaikin Analytics, probably one of the most complete set of investment tools and stock market model-building technology that’s available for the money. Or at least I’ve ever seen.

The Chaikin Analytics Dashboard

The Chaikin Analytics Dashboard

How does Chaikin level the playing field?

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The End of Everything and the Beginning of Nothing

April 26th, 2014

Zero Marginal Cost SocietyThe predominant economic systems are capitalism and communism. Both have their problems, which seems to explain the existence of mishy-mashy socialism in most countries.

Most futurists debate which economic system will dominate the next century. That’s a mistake, according to some experts, like Jeremy Rifkin. Rifkin recently wrote The Zero Marginal Cost Society that looks at how technology and ideas, like the Collaborative Commons, will re-shape the financial status quo.

Adding sensors to just about everything will move the power of info-centric businesses — think energy and utility companies — back into the hands of individuals. If a person had smart enough algorithms, for example, they could purchase energy much more efficiently, use it efficiently, and save it efficiently. In a very real sense, an individual could run their own utility company.

But, that’s just the beginning. Let’s try to connect all the zero-marginal cost technologies. 3-D Printing has already received lots of hype, but buried deep within this technology are several — forget disruptive — transformative technologies. What if you could 3-D print your own efficient solar cells? What if you could 3-D print your own efficient battery? Let’s go crazy here. What if you could 3-D print a fusion reactor for your home.

So, now you’re going to not only be a smart consumer — a prosumer in Rifkin’s lingo — to a smart producer — or a producer… wait, that doesn’t work. Anyway, what happens when you produce something for almost free and use it so efficiently that you avoid costs. Well, everything becomes nothing. In other words supply increases to near infinity and costs fall correspondingly to near nothing.

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Accelerating Technology, Business Strategy, Investing, Money , , , ,

Did Kickstarter donors just get ripped off for billions?

April 5th, 2014

By now, we have all read about the Facebook acquisition of Oculus, the virtual reality company, for $2 billion. That’s billion — with a “b.”

kickstarter

The debate can go on about whether this is a sell-out to Facebook and their slick and sometimes creepy marketing machine, or the next stage in a revolution of virtual reality. Or, both, for that matter. What a lot of people are wondering — especially those who donated money to Oculus through Kickstarter — is whether they got ripped off.

Kickstarter, a crowdsourced donation site, helped Oculus raise $2.4 million for its Rift product back in 2012. In exchange, backers received t-shirts, posters, and prototypes, depending on their level of gift.

So, legally, the answer is “no.” Nobody got ripped off. These people donated, they didn’t actually invest in the virtual reality company, nor were they promised any sort of any financial remuneration from Oculus for their donation, if they were able to sell the company.

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Accelerating Technology, Business Strategy, Investing, Money , , ,

We Are Fred Phelps

March 22nd, 2014
We Are Fred Phelps

We Are Fred Phelps

I would like to take a pause from the normal financial news and information of this site and, because it is really my only vehicle for this type of writing, talk about another topic — Fred Phelps. Phelps, the odious leader of the uber-odious Westboro Baptist Church, died this week. He and the Westboro Baptist Church made headlines for their “God Hates Fags” signs and protests at soldiers’ funerals.

Phelps wasn’t a polarizing figure. He was a unifying figure. Liberal or conservative, we could all hate Phelps. He was an equal opportunity hater and hated us all right back.

But, might there not be a little — about half — of Phelps in all of us? That’s my question — do we come off as Fred Phelps? Check out social networks, or watch the news and you will see and hear how ideology has split us into two ideological camps. We create templates for our hate. The same cruel jokes that liberals heaped onto George W. Bush and conservatives a decade or so ago match up pretty well with the anti-Obama, anti-liberal crowd today. We post our meme updates on Facebook and we call each other Rupugnican and libtards. All of which plays well to our peer groups. Liberals preach to the liberal choir, conservatives to theirs, just like Phelps came off to his choir.

To each other, though, we start to look like a more targeted version of Phelps, but with just a bit less self-awareness.

And there are a lot of reasons to keep this going. By losing ourselves in our ideologies, we place ourselves in demographics, which makes it easier for news organizations, publishers, and entertainers to spoon feed our hate and fears. Follow the money, reporters always say, and there’s a lot of money to be made in this.

We may make some friends with our re-spewing of the hate industry that most of us call politics, but we’re going to lose some, too — maybe even some good friends. We won’t make much headway and converting people to our ideas — because it’s really about preserving our self-interest, not at finding solutions that everyone can live with.

But, ultimately, we’re losing ourselves. We’re becoming soulless caricatures. When we cling to our ideology, at the expense of our humanity, we are Fred Phelps.

Online Investing AI

How Can You Avoid the Next MtGox Bitcoin Meltdown?

March 1st, 2014

mtgox

Bitcoin was supposed to be a safe haven — away from the greedy hands of corporations and bankers and far from the idiotic brains of mindless speculators. It was a popular people’s currency.

The evaporation of Bitcoins in MtGox has caused every fan of the crypto-currency to re-think this. And it’s making them ask: How can we avoid putting our Bitcoins in the next MtGox?

Short answer: you can’t. What seemed to be lost in the idealism of Bitcoin — that it’s some weapons that would only be wielded by the good against those who are evil — was the critical idea that Bitcoin, and every other crypto-currency for that matter, is that it’s only a tool. And tools can be misused and crafted into weapons very easily. It all depends on the hands that are using it.

Whether MtGox debacle was one of greed, or one of incompetence, remains to be seen. But just because MtGox went down due to either fraud-or-fuck-up dynamic does not mean it won’t happen again.

While there’s no way you can completely avoid the mess, you can consider some risk-assessment strategies to pull the needle back to your side.

Insist on Transparency
Bitcoin is supposed to be about transparency; its exchanges should be equally transparent. If you believe that the exchange you’re using isn’t completely open, find another.

Remain Cautious
Continually monitor the Bitcoin situation. There were rumors that MtGox was sketchy. Only the smart ones got out in time.

Panic, then Assess
People tell you not to panic. But if you sense that your exchange is faltering, get your Bitcoins out immediately and redistribute them elsewhere. If it is just a drill, you can move them back.

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Business Strategy, Internet, Investing, Money ,

Crowdsourcing The Personal Hedge Fund

February 2nd, 2014
BOTR

BOTR

Many people have problems with hedge funds and big investment conglomerates. They rake in billions of dollars and live like rock stars.

People hate them so much they protest constantly, occupying this and occupying that.

But, I don’t have a problem with them. In fact, the chants of sympathy for the poor and working class and hand-wringing over income inequality are typically a cover for the protesters who are simply jealous of the big financiers. Had they stumbled onto these opportunities, they would be in the same penthouse, driving the same Porsche.

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Accelerating Technology, Automated Trading, Investing, Online Investing AI , , , , , , ,

From Main Street to Mainstream: Will More Businesses Accept Bitcoins?

January 18th, 2014
From Main Street to Mainstream

From Main Street to Mainstream

If Bitcoin becomes mainstream, it won’t do so because of the bankers, hedge funders, and other Wall Street types. Those folks are happy to trade whatever type of currency comes their way. If tomorrow, the world switched to beaver pelts, you can bet that someone would create a beaver pelt ETF, or build a hedge fund that is invested heavily in beaver pelt-for-dollars trading.

But, for Bitcoin to become more accepted as a mainstream currency, users will need to pave a path to Main Street. That hasn’t been the case, so far. But there are signs that this is changing. In fact, two trends — gift cards and third-party Bitcoin facilitators — can make the alt-coin more user-friendly.

Main Street Vs. Wall Street

Main Street is more cautious and fearful than their “No Fear” counterparts on Wall Street. Bitcoin has terms that they’re not familiar with — algorithmic mining, blockchains, wallets, etc. It can be scary for someone from a non-tech background to embrace this alt-currency. Much easier for them to reach into their own physical wallet and produce a dollar bill or a credit card, right?

Then, there are governments who are taking shots at Bitcoin. They are not accepting it — and some are even banning it. This makes total sense. Bitcoin is a threat to their monopolies on currency, one of the key ways they hold power.

So, Bitcoin does have some hurdles.

However, there are signs that the ice of fear is starting to be chipped away. Trends are starting to develop that can build a bridge from alt-coin users to Main Street.

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Investing, Money, US Economy , , ,

Is Investing Really a Zero-Sum Game?

January 6th, 2014
Zero-Sum Game ContraryBrin

Zero-Sum Game ContraryBrin

Investing — in anything stocks, bitcoins, goat futures, whatever — is a zero-sum game, according to most critics and proponents of investing.

Someone buys, someone sells. Someone wins, someone loses.

In a very broad sense, this is true, but if we look a little more closely we can see that the zero-sum game does not exactly fit investing because of the timescale involved. In fact, investing is rarely a zero-sum game.

We like our models. No, not super models. Humans use models to improve the efficiency of thinking. Guesswork, it turns out, is what being intelligent is all about. That’s why when we one of our investments sours, we immediately equate that to a game, like baseball or football. We struck out. We lost.  But baseball and football — or whatever game you’re into — have finite time limits: innings, quarters, periods, etc. But many investments do not.

Take a stock trade. You may buy stock in a company and the price begins to go down. You sell your stock and someone buys it. According to the zero-sum model, you lost: you bought high and sold low. And the other guy bought it lower, so he won.

However, you have yet to hit the ninth inning. What if you take that investment and buy another stock and it soars? What if the winner in this trade — the investor who bought your stock — finds that the company continues to underperform and its value continues to crater?  These trades — that seemed to be a winner-loser type of thing — can be seen as only one play in a much longer, much more complex game that we call the “market.” The buying and selling of an investment are usually seen as “the game.” As we can see in the above scenario, they are not. They are just plays within the game.

Only finite limits define a zero-sum game and, as long as people are in the market and companies are being created and sustained — then, the zero-sum game heuristic does not fit. In fact, it can be debilitating. People who fail at certain investment strategies immediately exit the game.

In other words, investing isn’t so much a zero-sum game as investors are zero-sum thinkers.

Obviously, there are much better examples of the zero-sum model in investing. Off the top of my head, I see that options — which can expire at a certain time and be essentially valueless — is a type of zero-sum game. If you don’t exit in time, or the underlying security doesn’t perform to your expectation, then your investment goes to zero. You lose. (However, I would point out that option trading has become a thing-in-itself and not what the strategy is most ideally intended — as a hedge to non-zero-sum game trading. You should use options to guard against risk on your main options.)

There are probably other types of investing that are better understood in the zero-sum model.

The point I would like to pass on is to be careful of our models. They become self-fulfilling prophecies — and not just for us. They can spread and infect other people’s thinking. They can lead to the most horrible type of model-making called “policy changes.” A policy change is when a government entity decided to make bad heuristics into the law of the land and there is only one true law in this case — the law of unintended consequences.

What do you think? Do you think zero-sum investing is still a good model? Do you know of other investment models, or perspectives, that have similar faults?

 

Dreams Come True, Investing, Money , , ,

Bitcoin 101: The Ultimate Source for Understanding Bitcoin

December 27th, 2013

Bitcoin1large

Bitcoin, an alternative currency that is challenging the rights of states to be the exclusive provider of currencies, continues to be hotly debated. Are they wave of the future for currency, or just the next Internet-based bubble? Is Bitcoin a viable form of currency, or simply another form of speculation?

Before you can answer the question, though, you need to find out just what the heck a Bitcoin is. Here, then, is a comprehensive list of information sources, as well as sources of insights, predictions and tutorials on Bitcoin.  This is a perfect place to start if one of your resolutions this year is to start exploring — and possibly investing in — this alt-currency.

This is a beginner’s guide to Bitcoin from Bitcoin Intro.

Go to Udemy and you can learn to stop worrying and love crypto. From the course intro:

The course is divided into several sections. The Core Lecture Path serves as a comprehensive introduction for beginners on all relevant topics necessary to have a deep understanding of Bitcoin including why Bitcoins have value, why they can be used for anonymous transactions, the current economy of Bitcoins, how they are made and distributed as well as speculation.

Take a course in Bitcoin from Khan Academy, one of the leaders in alternative online education.  In this course, you’ll get to hear answers from an expert on questions such as: “What are some general advantages to using Bitcoins in a transaction vs. using Dollars, Euros, Pesos, etc.– i.e., what is the point of their existence? As if the concept of paper money isn’t hard enough to comprehend; now, digital money.”

Here’s another Video Course on Bitcoin.

Need something even more basic? You can find a Bitcoin Wiki and learn how to use Bitcoins at this site.

Start Bitcoin walks you through the Bitcoin process.

Here’s a simple explanation of Bitcoin from Medium.com.

Interesting Bitcoin Investing Alternatives

If you’re ready to level up to beyond-the-basics, Bitcoin is inspiring entrepreneurs to create side businesses and investment alternatives.

This blog examines trading signals for Bitcoin — BTC Trading 

A group of founders created a investment trust called the Bitcoin Investment Trust. The minimum investment is $25,000.

Prediction Sources

The direction Bitcoins will take in 2014 is impossible to predict. There are too many variables and not enough historical data to offer some notion of how Bitcoins will react to different market conditions.

Conversations are divisive about the alt-currency. We have backers  and detractors.

It’s important to point out that we’ve seen pessimistic predictions proven wrong and optimistic forecasts dashed. However, expectations are high for 2014.

Happy learning! And have a Happy New Year!

Please feel free to pass on your comments, questions, and concerns.

Accelerating Technology, Internet, Investing, Online Investing AI , , ,

Will Disruptive Technologies Become Disruptive Disruptive Technologies?

December 14th, 2013

drone

The number of new technologies gushing out of startup companies and research laboratories are lapping at the shores of the consumer marketplace at a rate that is unprecedented in human history.

In another historic first, these innovations are coming from every field — computer, medical, logistical, etc. Previous eras have seen jumps in technologies in certain fields, for example, agriculture, or metallurgy, but not simultaneously.

This rush of innovation will destroy some current technologies and business models, it may collaborate with, or even extend others. Interestingly, we may see some of these new technologies disrupting each other. It’s a natural extension of the law of technological acceleration.

As a consumer or an investor, there are two trends that you should watch:

Drones
By now, you’ve seen or heard about Amazon’s investment in drone technology. The unveiling on CBS’s 60 Minutes was an internet sensation, spreading the news virally about a fleet of aircraft delivering packages to your home, or, for the dystopians, a fleet of craft that will hunt us down and kill us.

Read more…

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