Notes for Chat with Traders, Episode 121

Added on by C. Maoxian.

Episode 121 -- Michael Mauboussin (57:11)

  • Pronounced Mo-bisin (like Larry Curly and Mo)
  • Works for Credit Suisse
  • Liberal arts major
  • Did training program at Drexel Burnham Lambert
  • Gravitated to research
  • Junior analyst job
  • Hired by First Boston, early 1990s
  • Morphed into a "Strategist"
  • Teaches at Columbia Business School
  • 25 years of teaching security analysis
  • Kahneman, Tversky behavioral studies: humans rely on rules of thumb with decision making
  • Humans have cognitive limitations
  • Auditing quality of decision making
  • Valuing process over outcomes
  • How much of a role did luck play?
  • Heuristics and biases -- shorthands lead to biases
  • Prospect Theory
  • Overconfidence -- projecting narrow outcomes
  • Confirmation bias -- we seek information that confirms view, dismiss new information
  • Recency bias -- weighting recent events, not a larger sample size
  • How to combat confirmation bias? Keep an open mind
  • Phil Tetlock -- "beliefs are hypotheses to be tested, not treasures to be protected"
  • Bayes Theorem -- new information, update views
  • Your views should be tenuous [tell that to a priest!]
  • Framing -- how you present the problem skews things
  • Intuition is robust in a stable or linear realm (chess)
  • Usefulness of checklists -- pilots have them, keeps them consistent
  • Do-confirm checklists
  • Read-do checklists (for emergencies)
  • Stock down 10% versus the market, investors take out their read-do checklist to react calmly
  • "Think twice" -- inside outside view
  • Analysis paralysis -- some domains more information *isn't* better
  • Paul Slovic -- tested handicappers, accuracy of bets didn't get better with additional information, but confidence soared
  • Professionals don't want too much information, just the key information
  • How to combat indecisiveness: do you need to move or not?
  • Technique to get you moving: write down plus / minus columns
  • Techniques to surface alternatives: "pre-mortem" pretend decision worked out *poorly* by projecting into future
  • Spend as much time as you can reading, exposing yourself to different points of view
  • Cognitive neuroscience 
  • Hyperbolic discounting -- future self is good, self at moment is bad
  • Humans want immediate gratification while promising to be good in the future
  • Link things you like with things that you don't like
  • Treadmills (hard) and podcasts (fun) -- one way to motivate self
  • Split brain patients -- left versus right hemisphere activity
  • Left hemisphere has the "interpreter" -- links cause and effect
  • Humans love stories (narratives)
  • Statistical arguments are palid, while a story is salient
  • Be a good storyteller, don't spout dry statistics
  • "Tales from Both Sides of the Brain" -- good book
  • Gazzaniga Scientific American articles
  • Keep a journal of your decisions (date and time it)
  • Go back and audit quality of decisions
  • Hindsight bias and creeping determinism
  • Skill dominant games -- the best player wins
  • But games where probability matters, process is all important
  • Good outcomes, horrible process
  • Adherence to good process, will win over time
  • World is dynamic, can only have components of process
  • Process must be transparent, economically sound, mathematically devised, repeatable
  • Fascination with Richard Dennis, Turtle Traders 
  • Curtis Faith book on Turtles
  • Skill versus Luck
  • Mauboussin an avid athlete 
  • Loved Michael Lewis's Moneyball book -- sticking to process
  • Taleb's 2001 book didn't quantify where the randomness was [annoying]
  • Short run luck will dominate, long run will zero out; then skill will shine
  • Techniques to isolate skill from luck
  • 82 NBA games a season, large enough sample to work with
  • All great investors think probabilistically
  • All great investors always have odds in their favor (positive expected value)
  • All great investors understand the role of time
  • Live to see another day -- "preserve optionality"
  • Puggy Pearson advice best: Understand the 60:40 end of a proposition (edge), money management (how much to bet), and knowing yourself (know your psychological shortcomings)
  • Twitter: @mjmauboussin


Notes for Chat with Traders, Episode 122

Added on by C. Maoxian.

Episode 122 -- Doug Cifu (39:38)

  • Co-founder of Virtu
  • Formerly a corporate lawyer
  • Formerly a partner at Paul, Weiss, Rifkind, Wharton & Garrison in NYC for 18 years
  • Fast talker, sounds like native New Yorker
  • Private equity firm General Atlantic a client
  • General Atlantic had idea that exchanges would become electronic, for-profit
  • He was the lawyer representing GA in all their investments
  • Met New York Mercantile Exchange (NYMEX) chairman: Vinnie Viola
  • Vinnie Viola asked him to leave Paul, Weiss and partner with him to found Virtu in 2008
  • Virtu is an electronic market making firm
  • "Old school market maker" using latest technology and automation
  • Vinnie was a local risking his own capital, just wanted to make a tick
  • Provider of liquidity without customer order flow
  • Doing one thing, doing it well, and repeating it
  • Latency arbitrage isn't illegal or immoral
  • Data centers in New Jersey, data centers in Illinois
  • Spread Networks: it's not evil, it's just commerce
  • Evolved to microwave network transmission, even faster
  • Being faster by a microsecond isn't a sustainable business model
  • Virtu takes no directional trades, they think they can make a tick
  • They don't pray for mean reversion
  • Trading 4.5MM times a day
  • Bias based on bid side or offer side being stronger, classic market making
  • The old rewards available to market makers don't exist anymore
  • For example, specialists got 25 cents a share (the spread) in 1982 on NYSE for holding inventory on blue chips
  • Wins 51% of time (usually) ... will never disclose scratch percentage [but it's obviously huge]
  • Michael Lewis running around with his hair on fire
  • Big barrier to entry to what they do, smaller firms can't succeed
  • Madison Tyler consolidation in 2011
  • To be US equities electronic market maker, costs are enormous ($70MM a year), market data, connections
  • Co-location at data centers, infrastructure, footprint incredibly expensive, wouldn't be profitable for equities alone
  • Their business is a scale business 
  • Little guys can't make it, must sell out (to Virtu)
  • Putting out bids and offers is taking risk, so lots of pre-trade risk controls, including human involvement
  • Hubris is a horrible vice
  • Virtu went public April 2015
  • One losing day in five years, operational error, mistake to put that info in, Cifu's fault
  • Not an arrogant cocky firm ripping people off
  • We're not swinging for the fences, just hitting singles
  • Regretted putting "stupid histogram" out there
  • Guys at ZeroHedge writing crap about it
  • Michael Lewis's book true of market in 2009 but not 2015, "didn't really know what the hell he was talking about."
  • Lewis is anti-money, anti-Wall Street ... "he's a capitalist dressed up like a communist"
  • Lewis wrote fictionalized nonsense
  • Markets have gotten more efficient, it's *better* than the old days because of firms like Virtu
  • He was "a reasonably smart young man"
  • Worked his ass off in high school, got into Columbia, worked ass off there
  • Got into Columbia Law School, worked ass off, got into Paul Weiss, worked ass off to become a partner
  • Kept eyes open, learned a lot about a lot of different things, was well rounded
  • Worked on top-flight deals, big M&A deals, exposed to a lot of stuff
  • Met Vinnie Viola, became good friends, they worked well together
  • Need some innate ability, but he's "the dumbest guy at Virtu," must work your ass off
  • Hire really smart people and empower them
  • Be modest enough to know what you don't know
  • No politics at Virtu, flat organization
  • His success based on hard work, many people helping him out along the way
  • No clue about financial markets in 2008
  • Titles are bullshit, don't have them at Virtu
  • I'm a smart guy, I can figure it out
  • Vinnie took the risk on a "loud-mouthed lawyer" like him
  • Client used to call him "Dougie Large, the man in charge" (because he's a little overweight)
  • Twitter: @Dougielarge

Notes for Chat with Traders, Episode 123

Added on by C. Maoxian.

Episode 123 -- Darren Reed (107:04)

Great episode, this guy is the real deal.

  • Former stock broker, former head trader at hedge fund, currently a prop trader
  • Grew up in South Africa
  • Went to public school, rugby team was good, wanted to play first team rugby
  • School bred attitude of grit, though underdogs through teamwork they can beat the rich kids
  • Dad is airline pilot, started as mechanic, parents immigrated to Australia (Perth)
  • Loved the team culture, loved competition
  • Uncle a pastor in Connecticut (Stamford and Greenwich) hooked him up with hedge fund guys
  • Interned at New York hedge fund just out of university
  • Felt at home whe he first saw the trading floor, the energy, the competitive spirit
  • Started in back office, lots of tedious, menial labor (that has since been automated)
  • Visa issues, had to go back to South Africa, parents said come to Perth
  • In Perth 2004 -- just good timing, mining boom, vast wealth creation [because of China demand]
  • First job: retail desk assistant at brokerage firm, did grunt work
  • "DTR" -- designated trading representative (licensed position to enter orders)
  • "DMA" -- direct market access
  • Watching order flow all day tick to tick
  • Good execution appreciated by brokers, everything automated now though
  • He held the order book, could feel the order flow, developed a sense of the market
  • Takes time to develop your craft, later can take advantage when opportunities arise
  • Algo execution killed the old manual order book
  • "Making chicken shit look like chicken salad" in sales [love it!]
  • You must be self-aware
  • Moved to Sydney, started trading at prop firm
  • He had success early on which is the *worst* thing that can happen to you
  • Skills have learning curve, baby learning to walk, surfer falling off board
  • Profitable at beginning through blind luck, got cocky
  • Intuitive sense developed through watching trading book
  • Be at your worst when you're at your smallest
  • Learning curve as a trader steep, you are losing money, it's hard
  • He was a one-trick pony, could make money in volatile environment, was lost when volatility died
  • Froufrou fairy dust theory of why you get hurt repeatedly at first: it's all karma
  • Doesn't use charts much
  • Tries to figure out who is trapped, who is under pressure
  • Read order flow on a tick by tick basis
  • Australia prop traders futures-based, like Europeans
  • 2008 blew up all the volatility traders
  • Markets change, advantages get arb'd away
  • You need a diversified trading group -- different strategies, different products, different time frames
  • Got a job at Sydney hedge fund, $300MM under management
  • Took old Darryl's advice: "Get your bum in a good seat and sit tight."
  • Hedge fund world highly regulated, he hated meetings, crossing t's, wanted to quit and did so
  • Trader development is serious biz -- handling hopes and dreams of kids
  • Qualities of good trainers: self-aware, know their strengths and weaknesses, honest transparent people, doesn't cover up weaknesses, you can't "solve" trading or golf, not a glamorous lifestyle, no Ferraris or phoning it in from a yacht [LOL]
  • Trading is a grind, bloody hard, don't believe the BS
  • Guys who admit bleeding, re-learning, evolving, they're real, seek them out
  • Qualities of good trainees: they have grit, bulldogs who won't let go, will take YEARS of struggle and grind; guys who have had hardship are best, they can grind; people who don't let go of their dreams; competitive drive; intelligent but not TOO intelligent; people who are too smart try to figure things out, that's why they fail;  empty cups, no experience best; put the work in themselves, don't expect to be told what to do
  • Not about being given "set-ups," it's about developing skill
  • "Environment is everything" -- special forces, great teams, lifted by pack in right environment
  • Trader sitting at home can't replicate prop trading environment
  • Need little financial encumbrance to start, can't have pressure to make money
  • Research the prop firm first, ask good questions
  • Need one or two year profitable track record (can be misleading if sample size small)
  • Pass the "pub test," no track record but enthusiastic
  • Mow lawns and wash cars to build a trading stake
  • Must work your ass off, sitting staring at screens for hours on end, no glamour, incredible grind
  • Incredibly boring work in a sense, no one talks about this [Twitter as outlet]
  • Income is incredibly variable, struggle for 50 weeks, make a killing [or get killed] in two weeks
  • Pressure of being a solo small business, live and die by your own hand, hard struggle day after day
  • People denigrate competition and achievement now, society getting weaker, why people are struggling, [Yes, western world in decline, standard of living deserves to fall]
  • Trading not fun and games, bloody hard work
  • Twitter: @LiftTheOffer

Notes for Chat with Traders, Episode 124

Added on by C. Maoxian.

Episode 124 -- "madaznfootballr" (72:58)

  • "Max"
  • Born in 1989?
  • Lives in California
  • Trading for six years
  • "Scalper"
  • "Rebelling against societal norms"
  • Made $5 an hour counting cards in blackjack
  • Sold stuff on eBay that he found or found mis-priced in stores
  • Studied structural engineering in college
  • Couldn't get a job after the Great Financial Crisis
  • Lots of student loan debt
  • Even when he did find an engineering job, it was a disappointing one
  • Colleague showed up in Lotus Elise, made money buying BP after oil spill
  • Max knew nothing about the stock market then
  • Opened an E*Trade account with $6,000
  • DANG first stock he ever bought, looking at 15-minute delayed quotes
  • Eventually found out about live quotes and E*Trade Pro
  • One year of trial and error, "completely clueless," no one to guide him
  • Started googling "hot stocks" and "stock tips" led him to message boards
  • Learned you must be a completely independent thinker
  • Almost quit in first year, suffered losses and a "damaged psyche"
  • Cumulative process, one day everything just clicked
  • Pattern recognition acquired after a year
  • In hindsight, he should have paper traded
  • "Money-hungry kid" deprived of a good career
  • Would go all-in on lots of trades
  • Play small until you acquire the necessary skills
  • He was too impatient in early days
  • Don't overextend yourself
  • Trading is not easy, it's true that 90% of traders fail
  • It's the psychological aspect that makes people fail
  • Worked as engineer for three years, and snuck trades on the side
  • Saved five times his salary ($300K total) and made two years of six figure gains before going full time
  • Traded early in the morning before going to his 9 to 5 job
  • Traded OTC and penny stocks at first
  • Naturally impatient person, naturally anxious person
  • Scalping suits his personality
  • Gets in and out extremely fast
  • "Typical" holding period of two to three minutes
  • "Typical" number of roundtrips per day: twenty
  • You have to be quick manually and make quick decisions
  • Hotkeys are huge, without them like bringing knife to gunfight
  • Has price levels pre-entered (limit orders, I guess)
  • Always uses limit orders, never market orders
  • Gets up at 6AM (Pacific time)
  • Looks for low float, low priced stocks gapping up biggest, "top gapper," large volume
  • Started with one minute bars but switched to three minute bars
  • ThinkOrSwim had three minute time intervals as default
  • The "tape" is main thing he uses to make trades, hard to explain
  • Spotting "Iceberg" orders ... "bid prop" and "refreshing seller"
  • Record your screen: Level 2 and Time and Sales and the Chart and re-watch in slow motion
  • VWAP gained prominence in recent years (2013 2014)
  • Over / Under VWAP ... 
  • Need to be mentally stable and confident to trade
  • Meditates and tries to enjoy life to clear his mind
  • If you have addictive personality, self-control or anger issues -- they will come out in trading
  • Don't trade during low volume hours, just walk away
  • Identify if you have an addictive personality
  • Give back to the community
  • Comes from very humble beginnings, never been interviewed before
  • Twitter: @madaznfootballr

Notes for Chat with Traders, Episode 125

Added on by C. Maoxian.

I just discovered this podcast called "Chat with Traders." It looks really interesting and I plan to listen to them all (in reverse order) and share my notes for each one.

Episode 125 -- Matthew Hoyle (58:35)

  • Dutch?
  • Born in 1984?
  • Head hunter
  • Formerly an options market maker, in Amsterdam
  • On trading floor for six years
  • Started at age 13? Is that possible?
  • Exchange went electronic 2003
  • Didn't go to university despite opportunity to go to the best (in Holland?)
  • Went into head hunting in 2003
  • Makes more money as a head hunter than he did as a trader
  • Paid seven figures as a trader
  • "Executive search" is the high end, "experienced hires"
  • Recruitment is volume-based
  • Relationship-based business
  • Doesn't hire for "arcades" (where people bring their own money)
  • If a head hunter calls you, listen, don't just hang up
  • People (traders) like to talk about what they're good at
  • "Manual" trading firms disappearing, everything is automated now
  • Don't apply for stuff that you're not qualified for
  • Most firms want to hire fresh grads, *not* experienced people
  • Mental arithmetic tests used as stress tests
  • Technology + trading is the key combo ... must be able to program
  • Don't bother learning Java now, must know scripting languages
  • Old point and click traders hire coders to automate what they know
  • Paul Rotter, a classic point and click trader, "The Flipper," retired now
  • Whole industry is automating, all algo traders now
  • Experienced manual traders making a bit less money every year now
  • Strict division in some firms between tech side and trading side
  • Shortage of C++ programmers so severe they'll take any age
  • PDT, Renaissance Tech ... they want academics, will take old guys
  • Perks are nice, but retaining people all about compensation 
  • Formula-based percentage of trading profits
  • RenTech has zero turnover ... extremely highly paid people
  • Discretionary bonus models; team-based structure, profit distribution
  • Pit traders in Chicago haven't vanished entirely, just much smaller numbers
  • Prop trading within banks did completely disappear for awhile
  • Hiring is based on volumes first and volatility second
  • Virtu has only 150 employees worldwide
  • Volatility high means traders hired, volatility low means tech guys hired (fight latency wars)
  • Volatility and volumes both low, layoffs hit hard (hedge funds, prop trading)
  • Banks not as nimble as hedge funds, way overstaffed, full of dead wood
  • AI is going to be big, lots of demand for people who understand it
  • A trader with one strategy, a one-trick pony, will never be hired
  • You have to be passionate in the interview, don't be negative
  • People will hire you because they think you'll make them money, it's obvious
  • Do mock interviews! Practice makes perfect. Use Glassdoor to get the questions
  • "Thank you for inviting me."
  • Twitter: @MatthewHoyle

Keepin' It Flirty

Added on by C. Maoxian.

Still on a Rachael Price and her Giant Mouth kick ... silly silly song, but I love it. God she's good. And the band is growing on me too. 

Funny Not To Care

Added on by C. Maoxian.

This lead singer is really good, love her voice, close your eyes so it's not marred by her white girl dancing .. she deserves a better backing band than these hipsters.

Dissecting a Madaz Play

Added on by C. Maoxian.

Madaz shorted $TCCO this morning and I wanted to dissect the trade. 

First, we know he was watching $TCCO because it was the number one Up Gapper:

At 9:39 AM he tweeted that he had "nailed" it for $5,200 having shorted "4ish average" and covering $3.50. 

Now let's look at a micro timeframe chart here, 10 second bars ... that should read "pre-open high $3.70" not "high $3.70."

Later at 9:54 AM he tweeted that he covered his final 2,000 shares at $3.20 bringing the total gain to $5,800 ... $3.20 is 30 cents below $3.50, times 2,000 shares is $600 additional, that makes sense, I guess. 

Here's the chart again with the $3.20 level marked.

Finally, he tweets his P&L, which he does every day, win or lose. 

What's revealed in the P&L is that he realized $5,942.85 by shorting $TCCO, generating 10 tickets and trading 66,096 shares. I'm not sure if the shares and tickets numbers mean he bought and sold 33,048 shares or bought and sold 66,096 shares, or 5 buys 5 sales, 8 buys 2 sales, 9 buys 1 sale, etc.? Maybe some kind reader can enlighten me via email (or Twitter).

Let's assume that he bought 33,048 shares and sold 33,048 shares to make the $5,942.85. That's almost exactly 18 cents a share. So we have to assume that he is averaging into the position and averaging out of it, and was able to walk away with 18 cents of profit.

If he simply shorted 33,000 shares at $4 and covered 33,000 shares at $3.50, he would be making over $15,000 on the trade, not $6,000. I'm not sure how much of a difference the final 2,000 shares covered at $3.20 can make.

I'm just thinking aloud here, I'm trying to make sense of this. 

A bigger question is *why* did he begin shorting where he did to build a 30,000 share position with a 4ish cost basis? Was he "reading the tape" and built the short based on that? This thing traded up to $4.40 ... if he were short 30,000 shares from 4 and it ran on him, would he get out at $4.40? How much slippage would he suffer? Was he willing to risk $12,000 to make $6,000?

I'm just thinking out loud here, trying to make sense of this. I'll update the post as I continue to think about it, and incorporate any other wise people's thoughts, with credit of course! 

Two readers have written in with their comments, both full-time traders with many years of experience:

As to his trading TCCO today your guess is good as mine as to how those 60k+ shares were distributed within the 10 tickets you mention. What I find odd here is that based on his strategy as explained in his various YouTube videos, he doesn’t short unless price is at or below VWAP and below pre-market highs. Maybe he has some nuances to his strategy that I am not aware of, but this particular TCCO trade is opposite of how he “normally” trades short. If he goes long its almost a reverse mirror image of this TCCO short trade. I believe most of his trades are cleared through ETC.

Based upon one of his recent tweets about getting enough rebates to cover commisions, I am led to believe he probably hits bid/ask for entry/exits about half the time, otherwise why “advertise” you covered your commissions with rebates.

From my viewpoint, if his trades are real, he is scaling in and out hiding share size but what is sketchy to me, based upon experience, is that he is able to move 5k-30k lots without moving price dramatically and getting full fills. The volume in the majority of the low floaters he trades in my opinion can’t absorb the share size he is using and getting filled without adversely moving price. I trade them from time to time but the only way I can get multiple thousand lot fills is to piece it out hiding shares at various price levels and even then I end up not getting full fills and have to cross the book and hit bid/ask to close position.
First off, it’s 33,000 in and 33,000 out for his total shares. And yes, his risk to reward is completely skewed. I’m not a fan of how he trades. If he got short on this around 4 and especially because of the super low float he could have just bid whacked 10,000 share blocks and knocked the price down himself easily.

There was no reason to cover where he did. He claims to use the three minute chart and if you take a look at it there was no reason to only get such a small piece of that move. I really think the only reason why and how he has made money is because of the sheer size of his positions.

An answer to your question of why he would short there is because we are familiar with the name and also super low floats. You get to know these things over time and this is textbook: it hit half dollar resistance and pulled, and once these pull it’s over and can be pretty safely shorted.

Especially if you look at that last green candle and how big it is on the three minute chart. It’s going parabolic and that’s a dead giveaway that it will pull back. These stocks are a completely different world, but once you get to know them, they are highly predictable. He does know his set ups, but I really think he gets scared out of his trades because he is using too much size. He would be way more profitable if he sized down even a little bit.

Trailing a Stop in LBTYK

Added on by C. Maoxian.

I sent out this short set-up in $LBTYK for April 27 to everyone who signed up for my free Daily Trading Idea ... sign up now if you haven't already done so.

Here's the image I sent in the email ... I checked my records and I did short $35.10 at 2017-04-27, 12:09:35 on ISLAND, no doubt by accident after transposing the numbers ... I do this at least ten times a day, make trading mistakes I mean ... confidence-inspiring, I know).

Seven days later it looks like this:

So the question is what do you do when it gaps below the target? I'm going to cover half tomorrow morning and trail the stop above today's high of $32.54. I can see this thing going down to $29 or even $26, but I want to take half off the table now. If you have any better ideas, I'm eager to hear them (on Twitter or via email), and I will share them in turn!

Initial risk was 44 cents and the target was over $2 away so the risk/reward was 1:5, and if I cover near where it closed it will be closer to 1:10 ... a "ten bagger."

Sign up for my Daily Trading Idea today, it's free!

UPDATE: @DavidTaggart suggested moving the stop to the high of two days before every time it makes a new low. @Contrahour suggested an Average True Range based stop, which is a little more complicated, so I'll go David's high of two days ago for now.

Sites to Worship Heavenly Bodies

Added on by C. Maoxian.

I read Ian Johnson's piece, My Beijing: The Sacred City, with interest since I too first lived in Beijing as a student (in 1991) and then spent ten years there (between 2005 and 2015).

Some excerpts with my comments:

"I studied Chinese language and literature at Peking University from 1984 to 1985 and biked over to [the Ritan park] area because it had become the country’s chief diplomatic district and one of the few places where homesick Westerners could buy chocolate and postcards."

Nutella. That's what we bought (and hoarded) in 1991 ... only available at the Friendship Store. 

"I came for the croissants, but stayed for the tree-lined streets and the Temple of the Sun."

My son went to school at Fangcaodi, which was originally set up for diplomats' kids. When we would ride the electric scooter through that tree-lined area every morning, I'd tell him, "there are no other streets like this in all of Beijing."

"I ended up moving into one of the diplomatic compounds and the neighborhood became my home."

He doesn't say what the rent was in 1994, or how it changed over the seven years he lived there. I'm sure today it's thousands of dollars a month, even for a small place.

"This was a time when Chinese parks rarely had grass. Instead, the hard-packed dry earth of arid Beijing was raked by crews every few days. It was odd but had an austere beauty that set off the ginkgo and persimmon trees that lined the paths."

Parks in Beijing still have no grass and there's nothing beautiful about that hard-packed dry earth ... Johnson is clearly a glass-half-full kind of guy. To get that one photo with green grass in it that accompanies the article must have been a real trick shot.

"But this need for green space clashes with another trend in China: the surrender of public areas to the rich."

This is true. I used to visit Longtan Park, which was near our apartment, and goons with earpieces used to chase me out of areas that had been "privatized." It really got my dander up, but there was no way to fight back, 没办法.

"[There are] high-end restaurants, an exclusive social club, a German beer garden, a yoga yard, a strange antique furniture store ... commercial activities that don’t belong in this great old park"

These "money-spinners" have been there for ages and they're on the periphery; I saw no harm.

"I even listen for the screech of the tacky children’s amusement park with its half-broken choo-choo trains."

Those "tacky" amusement parks, with their derelict rides, which can be found in all these sacred parks, were some of my favorite places ... and my kids spent many hours in them (at 30 cents a ride).

"But over the past decade or so, Chinese have been searching for meaning in their lives."

Now that they can afford to, lol. 

"The admission fee of $6.50 [to the Daoist Temple] does keep out many people...."

45 kuai is a pretty high bar, it would keep me out for sure. 

"Beijing is still the capital of an authoritarian state. Beijing’s message is still the state’s message, perhaps not perfectly but still audibly."

True. But old Beijingers are a pretty rowdy bunch and are quick to tell you what they *really* think, if you're a foreigner who speaks Chinese, like Johnson does. 

Dirty Dozen, Long Only Portfolio, End of April 2017

Added on by C. Maoxian.

I introduced the Dirty Dozen portfolio earlier this month. I track a dozen popular stocks using a *monthly* trend following system. It might be interesting to know my take on these stocks if you hold any of them. I did settle on Chipotle as the twelfth stock, which readers overwhelmingly nominated. 

  1. Amazon
  2. Amgen
  3. Apple
  4. Chipotle
  5. Facebook
  6. Gilead
  7. Google
  8. Netflix
  10. Starbucks
  11. Tesla
  12. Twitter

There are no changes this month, but NVIDIA is at an interesting point ... it's the second longest-held position and the biggest winner ... it will be telling when the monthly trend finally turns down.

ETF Trading Portfolio Update -- May 1, 2017

Added on by C. Maoxian.

Taking a quick, large loss in the XIV and reversing short (by getting long it) ... and scratching my Euro short and getting long (by selling it short).  I know it's confusing, I should change the terminology in the spreadsheet and will try to remember to do so next week.