Blog Archives:

This Ashton Kutcher Video Says A Lot…

Posted by Timothy Sykes on Sun 5th of Jul, 2009 09:15:57 AM

..about what interests people because it’s currently the most popular link on Bit.ly (you can see the popular links updated hourly by following their Bitlynow Twitter profile (and follow me too HERE!)

Check out the video here:
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Paul Tudor Jones Speaks: Learn From A Billionaire Hedge Fund Manager

Posted by Timothy Sykes on Wed 3rd of Jun, 2009 05:45:23 PM

Paul Tudor Jones (PTJ) is one of the greatest traders/fund managers of all time, learn about him in Wikipedia HERE.

Very nice, but more importantly, he gave a great interview to Alpha Magazine HERE so I’ve reposted the whole thing below (thanks to BS for finding this article)

Learnnnnn from a true trading master:

What’s so special about macro hedge fund managers?

I love trading macro. If trading is like chess, then macro is like three-dimensional chess. It is just hard to find a great macro trader. When trading macro, you never have a complete information set or information edge the way analysts can have when trading individual securities. It’s a hell of a lot easier to get an information edge on one stock than it is on the S&P 500. When it comes to trading macro, you cannot rely solely on fundamentals; you have to be a tape reader, which is something of a lost art form. The inability to read a tape and spot trends is also why so many in the relative-value space who rely solely on fundamentals have been annihilated in the past decade. Markets have consistently experienced “100-year events” every five years. While I spend a significant amount of my time on analytics and collecting fundamental information, at the end of the day, I am a slave to the tape and proud of it.

Is it possible to teach someone to be a tape reader — what some might call a trend follower or technical analyst?

Certain people have a greater proclivity for it because they don’t have the need to feel intellectually superior to the crowd. It’s a personality thing. But a lot of it is environmental. Many of the successful macro guys today, they’re all kind of in my age range. They came from that period of crazy volatility of the late ’70s and early ’80s, when the amount of fundamental information available on assets was so limited and the volatility so extreme that one had to be a technician. It’s very hard to find a pure fundamentalist who’s also a very successful macro trader because it is so hard to have a hit rate north of 50 percent. The exceptions are in trading the very front end of interest rate curves or in specializing in just a few commodities or assets.

What’s your take on the next generation of managers?

I see the younger generation hampered by the need to understand and rationalize why something should go up or down. Usually, by the time that becomes self-evident, the move is already over. When I got into the business, there was so little information on fundamentals, and what little information one could get was largely imperfect. We learned just to go with the chart. Why work when Mr. Market can do it for you? These days, there are many more deep intellectuals in the business, and that, coupled with the explosion of information on the Internet, creates the illusion that there is an explanation for everything and that the primary task is simply to find that explanation. As a result, technical analysis is at the bottom of the study list for many of the younger generation, particularly since the skill often requires them to close their eyes and trust the price action. The pain of gain is just too overwhelming for all of us to bear!

You’re not necessarily a fan of hiring people straight out of business school.

Today there are young men and women graduating from college who have a tremendous work ethic, but they get lost trying to understand the logic behind a whole variety of market moves. While I’m a staunch advocate of higher education, there is no training — classroom or otherwise — that can prepare for trading the last third of a move, whether it’s the end of a bull market or the end of a bear market. There’s typically no logic to it; irrationality reigns supreme, and no class can teach what to do during that brief, volatile reign. The only way to learn how to trade during that last, exquisite third of a move is to do it, or, more precisely, live it — a sort of baptism by fire. One has to experience both the elation and fear as markets move five and six standard deviations from conventional definitions of value.

How will macro investing fare over the next five years?

The macro space will be great. I think we’re going into one of those slow or zero-growth periods in the U.S., which will give us a lot of volatility.

Will hedge funds do as well as they have done in the past?

Average returns will drop. The amount of money that was made by hedge funds in the past two decades was so outsize relative to anything in civilization in the past couple of centuries that it naturally attracted the best intellectual capital in the world. As a result, the inefficiencies that existed in the ’70s and ’80s and even the ’90s are not as readily seen. But in this business there will also always be that upper tier — that top 10 or 20 percent of managers who will outperform everyone else.

What experience had the biggest impact on your career?

Trading commodity markets back in the late ’70s — when they were still extraordinarily volatile — allowed me to experience repeated bull and bear markets across a variety of different instruments. Remember, in agricultural markets the cycle can be just 12 months. I lost my stakes a couple of times, which taught me risk control and risk management. Losing those stakes in my early 20s gave me a healthy dose of fear and respect for Mr. Market and hardwired me for some great money management tools. Oh, incidentally and by necessity, I became a pretty good fundraiser, which has helped me in the not-for-profit world.

Who’s had the biggest influence on your career?

My first boss and mentor, Eli Tullis, of New Orleans. He was the largest cotton speculator in the world when I went to work for him, and he was a magnificent trader. In my early 20s, I got to watch his financial ups and downs and how he dealt with them. His fortitude and temperament in the face of great adversity were great examples of how to remain cool under fire. I’ll never forget the day the New Orleans Junior League board came to visit him during lunch. He was getting absolutely massacred in the cotton market that day, but he charmed those little old ladies like he was a movie star. It put everything in perspective for me.

What was your single best trade or investment?

Probably buying March put options on the Japanese stock market in early February of 1990. The volatility was an absurd 5 percent, owing to the newness of the options market, with which many Japanese had little experience. Much like the U.S. stock market just before the 1929 crash, the Japanese stock market in early 1990 was following the same price pattern with remarkably similar fundamentals and valuations that provided enormous profit opportunities in a truncated period of time. I actually felt sorry for the people who were on the other side of that trade when I was buying those puts.

Your biggest missed chance?

I missed the subprime opportunity of 2007, and it rankles me every time I hear the term. We have studiously avoided mortgages at Tudor specifically because it is a big-carry game that does not adequately compensate for the inherent tail risk. That unfamiliarity, though, came with a huge opportunity cost.

Is the price of oil high for fundamental reasons, or are hedge fund managers and Wall Street driving it up?

It’s a very bullish supply-and-demand situation, and the peak oil theory is probably correct. But the run-up in prices is now bringing in an enormous amount of speculative, nontraditional capital such as pension funds and university endowments — principally through index products. Commodities have been the worst-performing asset class behind stocks, bonds and real estate for the past 200 years, but Wall Street doesn’t highlight that long history when selling commodity index instruments today. Instead, it shows a chart of the bull market of the past 12 years to rationalize why some pensioner should be long cattle futures in the derivatives markets as part of a basket. I am sure they were using similar logic about tulips three centuries ago. Oil is a huge mania, and it’s going to end badly. We’ve seen it play out hundreds of times over the centuries, and this is no different. It’s just the nature of a rip-roaring bull market. Fundamentals might be good for the first third or first 50 or 60 percent of a move, but the last third of a great bull market is typically a blow-off, whereas the mania runs wild and prices go parabolic.

Should hedge funds be more closely regulated?

I selfishly do not want to be regulated, but I understand the necessity of it.

An All-Encompassing Guide To Businesspeople On Twitter

Posted by Timothy Sykes on Fri 1st of May, 2009 08:15:21 AM

Thanks to a reader for sending me this list, before I simply posted a list of celebrity Twitterers, but this one is much better linked and more comprehensive. Enjoy and follow me on Twitter already!
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Wall Street Movie Sequel Deal Now Finalized With Oliver Stone Directing Michael Douglas & Wannabe “It” Boy Shia LaBeouf

Posted by Timothy Sykes on Wed 29th of Apr, 2009 08:05:59 AM

Oh yeah, this project has been around for several years, but only now that society wants to see Wall Street suffer for its sins has it been greenlit.
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4 Reasons Why Susan Boyle Is & Is Not Like A Penny Stock…

Posted by Timothy Sykes on Sun 19th of Apr, 2009 09:45:55 AM

As I outline in my PennyStocking DVDs and THIS FREE EBOOK, a Supernova chart pattern, the ones that’s made me millions of dollars over the past decade.

Like Ashley Dupre, aka Sptizer’s girl, Susan Boyle shares some qualities with Supernovas, but she also differs a bit too and that’s why when I make the comparison, I wouldn’t short her….just yet

1. SIMILAR: massive massive hype and press due to the novelty of the idea and a dominating coordinated PR effort by Simon Cowell’s companies (he would be the best damn penny stock promoter ever!)

2. DISSIMILAR: S.B. has the unique story and enough talent that will likely make her a star…question is for how long…remember that other opera dude Paul Potts who Cowell made believe was a cell phone salesman shot to fame and now has pretty much faded…like most singing contest winning stars (it’s all marketing!)

3. SIMILAR: Like Paul Potts, Susan Boyle isn’t some undiscovered sensation…she had a 1999 album…yup…this time she hit it big with marketingggggg! Most Penny Stocks rise due to hype and manipulation, don’t hate on it, love it!!!!

4. OK, here’s the viral video of her singing, she has a great voice, but the key is her look and people’s expectations…kinda like a homeless hedge fund manager

I’m 100% sure, some kind of news will break over the next few days and weeks that lessens her star–no, I’m not a cynic, I just know how hype and manipulation works–but for now Susan enjoy it, your reaping the rewards of partnering with Simon Cowell, the world’s #1 promoter.

This Is A Good List Of Celebrities On Twitter aka Celebrity Twitterers

Posted by Timothy Sykes on Sat 18th of Apr, 2009 03:00:17 PM

First, you gotta follow me HERE because I’m the only non-celebrity on this list!
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7 Reasons Why Jim Cramer’s Career Is Better Than Ever

Posted by Timothy Sykes on Thu 26th of Mar, 2009 08:05:02 AM

Considering how much debate has now broken out about whether Cramer’s career is over or not, I had to do a follwup…
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Check Out How Much The Top Hedge Fund Managers Earned While You Were Losing Your Ass In 2008

Posted by Timothy Sykes on Wed 25th of Mar, 2009 08:05:46 AM

From the BR blog originally from the NYTimes:
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Who Is the Real Lenny Dykstra?

Posted by Timothy Sykes on Wed 18th of Mar, 2009 08:15:09 AM

This post is in response to too many emails I got on the subject, grow up people…
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The Pre-Publication Story Of Bernard Madoff

Posted by Timothy Sykes on Sun 21st of Dec, 2008 02:30:59 PM

When I see a monster articlelike THIS one from the NYTimes, I know the writers did it not only because its the top story–no, they want book deals.
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Now That He’s The Only One Winning Big, Jim Chanos Gets The New York Magazine Biography Treatment

Posted by Timothy Sykes on Wed 10th of Dec, 2008 07:24:25 AM

Great, great biopic by NYMag on Jim Chanos, manager of the world’s largest true Short Selling hedge fund, up 50% this year on assets of $7 billion.
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No LiveStock Tomorrow, Just Pics & Video Of Me Hanging Out Drinkin’ Tequila With Jim Cramer

Posted by Timothy Sykes on Thu 16th of Oct, 2008 04:28:53 PM

No LiveStock tomorrow because I’m in Vancouver for the weekend giving a bad ass 7 hour seminar–still 2 spots left–sign up HERE…

UPDATE: Photo had to go, Cramer’s peeps not a big fan of our “pic” (it wasn’t him, just a guy who looked like him

PS If any of you or anyone you know if looking for a place in Kelowna, check out my girlfriend’s apartment for rent HERE!

Sarah Palin’s Income & Investments

Posted by Timothy Sykes on Sun 28th of Sep, 2008 04:31:44 PM

Thanks to Eddy for posting THIS link to a fun 12 page financial disclosure statement for Republican VP candidate Sarah Palin.

If you take the time to click, you’ll learn:
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What Legendary Trader Paul Tudor Jones Thinks About Oil…

Posted by timothysykes on Wed 16th of Jul, 2008 11:34:38 AM

You know how I’m always saying don’t listen to anybody in the financial media cuz none of them have any major trading gains/wealth, all just claim to have “experience”. (And no, Cramer’s $50mil does not count as “major” trading gains.) Well, there are a few good men out there that have more than experience, they have fortunes, so when they talk, you should listen.

Before I featured what billionaire George Soros had to say about the economy (see interview HERE), now it’s time for you to hear what fellow legendary/billionaire hedge fund manager Paul Tudor Jones (see bio HERE), a guy who banked during the 1987 crash, now oversees $18 billion, and hasn’t had a down year since he began in 1980, says about oil coming at you thanks to an article in Alpha by way of a great post on 1440:

Is the price of oil high for fundamental reasons, or are hedge fund managers and Wall Street driving it up?

It’s a very bullish supply-and-demand situation, and the peak oil theory is probably correct. But the run-up in prices is now bringing in an enormous amount of speculative, nontraditional capital such as pension funds and university endowments — principally through index products.

Commodities have been the worst-performing asset class behind stocks, bonds and real estate for the past 200 years, but Wall Street doesn’t highlight that long history when selling commodity index instruments today. Instead, it shows a chart of the bull market of the past 12 years to rationalize why some pensioner should be long cattle futures in the derivatives markets as part of a basket.

I am sure they were using similar logic about tulips three centuries ago. Oil is a huge mania, and it’s going to end badly. We’ve seen it play out hundreds of times over the centuries, and this is no different. It’s just the nature of a rip-roaring bull market. Fundamentals might be good for the first third or first 50 or 60 percent of a move, but the last third of a great bull market is typically a blow-off, whereas the mania runs wild and prices go parabolic.

Click the links above to the original article, but yes, you heard it from the billionaire himself–he thinks the oil bubble goes pop. Interesting, to say the least, especially for longterm shareholders of Exxon Mobil Corporation (XOM), Chevron Corporation (CVX), ConocoPhillips (COP), Schlumberger Limited (SLB) who have all become fat and cocky with too many profits. Now, there are several billionaires who would disagree, but they mostly got that way through investing in the industry whereas PTJ is one of the greatest traders of all time.

On a slow pump and dump day like today, this is something to think about…a fun little guessing game. A few months back, I was fortunate enough to have an hour or so chat with PTJ’s right hand man, Peter Borish, and came away thoroughly impressed so based on that convo and PTJ’s track record, I’d go with them, just as people thinking about trading Penny Stocks should learn from someone with a superior track record like me (see the ultimate guide to Penny Stock trading aka PennyStocking HERE!)

MarketMania Cage Match: Jim Cramer vs. Ken Heebner

Posted by timothysykes on Wed 9th of Jul, 2008 07:33:25 PM

Unlike most financial freaks, you know I like to stay faaaaaaar away for the economic guessing game, not because I don’t have opinions/do research on consumer spending, oil, housing, etc. but because I don’t pretend to be able to guess the changing time lags associated with pricing these issues into the stock market. Yup, that’s right, there are tons of time lags and we petty humans have no friggin idea.

So, I’ll keep making my pretty non-scalable 7 month 70% returns and let others whose business is scalable guessing games duke it out.

Tonight’s death match is between two “financial experts” who are polar opposites:

“There’s Always A Bull Market Somewhere” Jim Cramer who has suddenly started saying inappropriate/dangerous/emotional stuff like
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Why Tiger Woods Makes You Smile & Exemplifies The Beautiful Democracy Of Online Video

Posted by timothysykes on Sun 15th of Jun, 2008 01:14:27 PM

I was busy working on a dozen or so projects yesterday so unfortunately I missed seeing Tiger Woods’ US Open amazing comeback. Almost immediately, I wanted to see clips of the miraculous shots that were being blogged and written about far and wide…I went To ESPN.com–no updated video, just commentary…Yahoo! Sports, same…PGATOUR.com, same…USOPEN.com, guess.

Inevitably I turned to Youtube and found
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Is That Really Maria Bartiromo?

Posted by timothysykes on Fri 23rd of May, 2008 12:28:40 PM

I might be am a prick, but to help you guys better understand how everything on Wall Street is about perception, I gotta post this. Maria Bartiromo has been promoted hardcore as the sexiest anchor woman of CNBC, the photo below disproves that theory once and for all. Forget about just aiding and abetting stock manipulators, the fine folks over at CNBC are the true master manipulators!
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A Legendary Trader’s Music Video…Seriously

Posted by timothysykes on Fri 11th of Apr, 2008 05:00:32 PM

Other than legendary billionaire traders, you should listen to legendary-not-quite-a-billionaire-but-still-damn-successful-traders like Ed Seykota who’s featured in required reading Market Wizards. There’s little doubt as to his trading abilities, his musical talent, well,that’s a whole different story…let’s see what you guys think:

Gratzie Covel

The Second CNBC Stock Pump In As Many Days

Posted by timothysykes on Thu 10th of Apr, 2008 03:25:31 PM

I’m always ripping on Inspectd.com for being too simplistic/dangerous/giving chart reading a bad name…here’s a perfect example why, GTE, the latest Jim-Cramer/The Rock CNBC/WWE pump…yup, it’s been a whole 2 days since the last one…hurtful to naive investors…unethical…great for speculators…wake the f%#@ up SEC!

Chart shows a clear breakout, but it’s already off its high cuz this ain’t big-time breakout-type news. Sure, shorts are scared—as they should be—Jim/Dwayne/Cramer/Johnson’s no dummie for picking a solidly uptrending stock near its highs…but c’mon, can you smell the fakeout cookin’?

 

UPDATE: Now TITN breaks out to a new high thanks to a CNBC ention–damn, stock promotion is a happening biz, Lebed, you must be making some good $, right? Maybe CNBC should think about getting reimbursed by these companies, just put a lil disclaimer that no naive investor would ever see…c’mon Ge, you know you wanna, get those annual profits up from $300mil to $400mil, you can do it, you can do it all night loooooooooong!

Disclaimer: I have no position in either stock, I’ve tried playing The Rock’s picks from both sides, some stay up, some reverse, no edge, not much predictability, no thanks…I just think it’s wrong how the WWE frames it, creates a lot of unnecessary bad blood, ya dig

Good Financial Advice From Real Wall Streeters: Listen To Billionaires Over Journalists And Talking Heads

Posted by timothysykes on Mon 7th of Apr, 2008 01:37:48 PM

Here’s a great 3-part interview the man himself, Mr. George Soros, whose current net worth is north of $8 billion, all created through financial speculation. If you don’t know who he is, first be ashamed, then see his bio HERE. Then click the picture below to watch the pathetically unembeddable video:

Now that’s an interview! Always trust the views of experienced/proven-successful billionaires over that of the experienced-sounding but success-lacking journalists, marketers and talking heads who infest our great industry.