Counterintuitive Wealth Creation

“In our U.S. oil supply model, this has shown up as a “beat and raise” for U.S. oil production, where supply typically comes in ahead of expectations, and consensus estimates for supply growth must increase. This has been the case for the past eight years; however, starting in January of 2019, EIA actuals have started to come in BELOW our forecasts, in fact for seven consecutive months. In our April and September eur Energy Stat Reports we have discussed why the well productivity trend has started to slow and may even go negative. I follow over 50 publicly traded upstream oil & gas companies. They are “For Profit” entities that are not going to drill & complete new wells just to break even. Most of them are “hunkering down” to live within cash flow from operations, which is putting the brakes on U.S. oil production growth.

Your options are in-the-money if the stock stays at $100, but you have the right to sell it at a higher strike price, say $110. A lower strike price has more intrinsic value for call options since the options contract lets you buy the stock at a lower price than what it’s trading for right now.

This is an optional service that looks to strategically offset a portion of your realized capital gains by selling investments for a loss — potentially reducing your tax liability. Intuitive Investor accounts are based on a hybrid advisory model that incorporates technology with Financial Advisors. Please click here to take advantage of a FREE 30 day trial. To the momo crowd, the worse things get such as the bad jobs numbers today, the more money the Fed will print and the more money the government will borrow. The chart shows the rise in the Fed’s balance sheet from $0.87 trillion before the 2008 financial crisis to about $7 trillion now. In plain English, this is a fancy way to talk about money printing.

This mistake went unchecked for 30 years, with untold numbers pop psychology books and articles citing the result as evidence for a “hot-hand fallacy”. Public companies have to report earnings quarterly, and promptly disclose any “material” news — that is, the bad news they’d rather not talk about. Think of the IPO process as a way to become an inverse Instagram celebrity, where instead of faking the lifestyle you wish you had you have to give a full accounting of the parts of your life you wish weren’t real. Eventually, Jay decided that he wanted to go work on other things in the organization, and not have to deal with me and this particular engineering team.

In order to be eligible for the OTCQX tier, the firms must be current on all regulatory disclosures, maintain audited financials, and cannot be a penny stock, a shell corporation, or be in bankruptcy. , diversifying your investment across 70 countries and multiple economic sectors. This helps ensure no matter what the market does, your eggs aren’t in one basket.

This last point highlights the fact that CTA results can be strongly influenced by a few trades only, with the bulk of their performance being driven by these large outlier trends. CTAs, as a group who follow similar strategies, often have correlated results to each other. Considering all individual components of the Au.Tra.Sy Trend Follower Index, the average pairwise correlation between each CTA and the index is 0.79 with values ranging from 0.67 to 0.89 as illustrated by Fig.4. Note that the correlation is calculated on monthly returns from 1990 to 2010.

Classical Theory And David Ricardo’s Formulation

Most people who speculate hound the brokerage offices or receive frequent telephone calls, and after the business day they talk markets with friends at Currencies forex all gatherings. The ticker or translux is always on their minds. They are so engrossed with the minor ups and downs that they miss the big movements.

I really like to trade patterns that appear counter-intuitive – which is the exact reason why they work so well! All three of my Futures Systems are based on breakout failures that generate an excitable Test Bar, or a Hook, against the primary trend.

It seems reasonable after you understand it, but common sense isn’t always enough, you need to study economics, as you have done. Scott, I think it’s just a matter of education.

Practice Trading

We did have multiple teams, and the teams had to coordinate, and so we didn’t end up with a trader fully self-contained team. We were able to structure ourselves to enable teams to focus.

You should carefully consider whether trading on Nadex is appropriate for you in light of your investment experience and financial resources. Any trading decisions you make are solely your responsibility and at your own risk.

The Arora Report Stock Market News

A successful trader, Dennis, together with Bill Eckhardt, set up an experiment, later known as the Turtle Trading programme. Dennis, arguing that trading could be taught, hired a dozen applicants from diverse backgrounds and taught them a trend following system so that they could trade for him.

I use these examples when I want to illustrate elastic, or unit elastic demand. A few years ago I read that a highly effective medication for AIDS was being taken by only about 10% of all HIV positive patients worldwide.

They have that view despite the fact that higher cigarette prices lower the smoker’s real income. Most people don’t even know about the other kinds of demand curves. But I would add that I also think income compensated demand curves are generally far more elastic than most people think. Jeffry, Nice try, but I can’t buy your argument for several reasons. The strongest is that it doesn’t apply at all to monopolies, but I find that people have exactly the same misconception about monopolies as oligopolies. So the unfortunate truth is that people simply use bad logic. In addition, I don’t see any theoretical reason to support your hypothesis, which is that when costs rise oligopolies suddenly behave like competitive industries, and yet when prices fall they behave like cartels.

The main reasons behind the extraordinary rise in the stock market are money printing by the Fed and excessive borrowing by the government. Daniel Bernhofen and John Brown have attempted to address this issue, by using a natural experiment of a sudden transition to open trade in a market economy. The Japanese economy indeed developed over several centuries under autarky and a quasi-isolation from international trade but was, by the mid-19th century, a sophisticated market economy with a population of 30 million. Under Western military pressure, Japan opened its economy to foreign trade through a series of unequal treaties. In view of the new theory, no physical criterion exists. Deardorff examines 10 versions of definitions in two groups but could not give a general formula for the case with intermediate goods. The competitive patterns are determined by the traders trials to find cheapest products in a world.

That is, we expect a positive relationship between output per worker and number of exports. MacDougall tested this relationship with data from the US and UK, and did indeed find a positive relationship. The statistical test of this positive relationship was replicated with new data by Stern and Balassa . Similarly, most anyone should take the opportunity to offer in the marketplace a good which they have a relative advantage in producing. The law of comparative advantage describes how, under free trade, an agent will produce more of and consume less of a good for which they have a comparative advantage. Yes, I’m contradicting myself, but this is a both/and situation, not an either/or.

A Differentiated Trend Following Cta

The EIA’s total onshore growth of 700,000 bpd into December is close to the fastest growth we’ve seen at any point in the past five years. Furthermore, this is by far the fastest acceleration in growth at any point since the commodity downturn.” – Raymond James Energy Industry Brief October 21, 2019. This totally ignores the high geopolitical risk to oil supplies coming from the Middle East. Browse other questions tagged soft-question intuition big-list or ask your own question.

Or, it will be more efficient, if we hold off on delivering so that we can just batch everything all together. Part of what I learned on that project was the importance of shaving the right yak. That phrase that probably seems a little bit weird to some of you anyway, it isn’t a common phrase used in the The Counter-Intuitive Way to Trading software engineering field and elsewhere. Seth Godin has a lovely blog post, describing his story of the yak story. One of the most insidious things about this is that when a developer has to make a trade-off because of a deadline, what they’re really trading off is future risk against current velocity.

  • The behavior of the relative supply curve, however, warrants closer study.
  • Finally he was introduced, and in the course of conversation inquired of this man from the mountains how he could keep track of the stock market at such an isolated distance.
  • As a result, options traders must take into account these fees when considering the profitability of an options strategy.
  • We went live with virtually no bugs, certainly none that were serious bugs.
  • If experienced pundits have trouble with the intuition of comparative advantage, it can’t be that obvious.
  • Given the relatively high (6 to 8-figure) minimum account size to invest with a CTA, it might not be possible for a HNWI to diversify across a large range of different CTAs.

E&Ps will be properly incentivized to grow production. This is why I keep saying that the “Right Price” for WTI is somewhere in the $65 to $75 per barrel range. The U.S. Energy Information Administration’s (“EIA”) website says that they provide “Independent Statistics & Analysis”. During that time, I noticed that they miss the turns in a cycle because the formulas that they use to make supply & demand forecasts are heavily weighted to the trend. In other words, if supply has been increasing 100,000 barrels per day each month for the last two years, they assumed that it would keep going up at the same rate in 2019 and 2020. But this narrative fed on itself, and the IPO became too much of a big deal. It was the moment when average investors could buy in, and when early investors and employees could at least start counting down to when they could sell out.

Weekly Stock Market Digest: Record Job Openings

Shares for Beginners is for information and educational purposes only. It isn’t financial advice, and you shouldn’t buy or sell any investments based on what you’ve heard here. Any opinion or commentary is the view of the speaker only not Shares for Beginners. This podcast doesn’t replace professional advice regarding your personal financial needs, circumstances or current situation. I made a brief attempt to find timeseries data at the bank-of-canada website, but alas gave-up. I’m more interested in the M1/M0 ratio than the velocity. I think the reserve-ratio complicates the velocity question too much.