Systematic Advantage #40: Trading systems make building and testing portfolios easy Systematic trading offers a significant advantage in simplifying the process of building and testing investment portfolios. With such a system, you can choose from various assets, set your specific strategy, and establish your parameters. Once set up, the system operates like a tireless financial [...]
The Spectacular Saga of Nick Leeson: The Man Who Broke Barings Bank Barings Bank had been a pillar of the British financial establishment for over two centuries. However, in the 1990s, the bank found itself in the jaws of an unexpected and catastrophic undoing - the apex predator of the financial world was Nick Leeson, [...]
Systematic Advantage #39: Programming a system can be an eye-opening experience when you discover all the assumptions you were making in your trading process. The process of programming a systematic trading system can be an eye-opening experience. It requires you to go through and translate the assumptions you were making about the markets into concrete [...]
Systematic Advantage #38: Systems can't be bullied into a position Unlike discretionary traders, who may be influenced by external pressures, fear, greed, or personal biases, a systematic trading system strictly follows pre-defined rules and algorithms. It does not deviate from its set parameters under any circumstances, making it resistant to 'bullying' into taking a trading [...]
Understanding Skewness Everyone wants to be a winner. For investors, being on the winning side of the trades means the ability to pick the right stocks that can generate above-average returns over time. However, this is often an elusive goal for most investors, given the inherent skewness in financial markets, making it extremely difficult to [...]
The Carry Trade The world of finance can be complex and overwhelming, with numerous strategies, tools, and methods traders employ to maximize their profits. One such approach, which has garnered much attention, is the "Carry Trade." In this blog, we will explore the Carry Trade in-depth, from its origins and mechanics to the risks and [...]
Hansel and Gretel: A Tale of Trading Lessons The classic fairy tale of Hansel and Gretel, penned by the Brothers Grimm, is an unlikely source for trading insights. However, upon closer examination, we find that this enchanting story is rich with lessons for traders. Below, we unpack the tale of Hansel and Gretel and reveal [...]
Systematic Advantage #37: Make Evaluation of Performance Easy to Determine if the System Fits Your Trading Personality A unique advantage of systematic trading is its ability to make it easy for traders to evaluate a system's performance. This is essential, as a trader's personality often dictates their risk tolerance, trading style, time commitment, and preferred [...]
Chicken or Egg: Solving the Age-Old Mystery For centuries, people have pondered the famous conundrum: which came first, the chicken or the egg? Many theories have been presented throughout history in an attempt to answer this age-old question. However, with scientific breakthroughs and genetics study, the mystery may finally have a satisfying answer. In this [...]
How the British Pound got its nickname "Cable."Â The term "Cable" may not be immediately recognizable to many, but it's a widely used nickname in currency trading. Specifically, Cable refers to the GBP/USD currency pair, a combination of the British Pound (GBP) and the US Dollar (USD). But how did this seemingly odd moniker come [...]
