Goodbye Green Faucet and Seeking Alpha, Hello Bullshit-Free Blogging
As my recent non-geeky posts make clear, I’ve been thinking a lot lately about our own role in the blogosphere.
In a nutshell, I’m completely and totally fed up with unverifiable claims of trading greatness, fed up with anecdotal non-actionable analysis, fed up with the snake oil salesmen and the charlatans and the bullshit.
Now, I know I can’t stop the masses of doe-eyed rookie traders from driving their nest eggs off cliffs, but I can sure as hell not contribute to it.
Effective once they’ve read this post, I’ve asked blog aggregators Green Faucet and Seeking Alpha to stop republishing our work on their sites.
I’ve always known most of their contributors were more salesmen than real traders (sans some folks I respect very much like Quantifiable Edges, VIX & More, and Market Rewind), but the camel’s back was broken when I saw Green Faucet had given this guy from iBC his own special home on their site for all his valuable hindsight insights.
Really?
I won’t even waste your pixels with all the reasons that making that guy your lead man epitomizes everything that’s wrong with this industry (but for a humorous if not obsessed look into just that question, make sure you’re tapped in to duc’s blog and his near daily iBC drubbings).
By contributing to sites like GF and SA, I’m in my (very) small way feeding that machine, and traffic be damned, I’m taking a principled stand and unplugging.
We just celebrated our first birthday – maybe this is our blog’s mid-life crises, but I’m fed up. We will be embracing a new era of bullshit-free blogging.
Happy Trading,
ms
P.S. I can already envision two arguments from “that guy” that I know are coming. First, my (fictional) hedge fund has made a million gazillion % – I am a trading god. Response? Prove it, it’s not that hard. Second, I drive 1000x more traffic than your puny blog – the people love me. Response? There’s a very big difference between making a positive contribution to this world and being popular…just ask Cramer.
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Filed under: Random Stuff | 41 Comments
I have to respect your stand quite a bit. I enjoy your blog and have built, implemented, and traded several strategies (mostly trend following, with a little bit of mean reversion). Most of the contributors do not have verifiable trading records, and I must say you have more credibility than most by publishing audited statements.
I’m a college freshman, aspiring quant. I used to follow “that guy’s” blog. I haven’t read it for weeks after finding yours. I just wanted to say thanks; keep doing what you’re doing.
I hope Green Faucet and Seeking Alpha follow your lead as there are plenty good sites there.
“That guy” is a monumental dick. Indeud, as The Fly would say.
A note from the author: a couple of emails I’ve received since this post assume that I have sort of beef with “that guy” personally. I want to be clear that we’ve never had any contact of any sort – I have no personal beef. But I’m very familiar with his “work”, and he is representative of a much, much bigger problem in this industry. There are and will always be many, many more like him.
michael
Completely agree, Michael
About time someone stood up to these jerks!
There! I said it!
Rockin’
The Warmaster!! LOL ! I do agree with you though, and at the end of the day each person alone is responsible for their own capital, doing their own work and executing their own plan. If they don’t care enough to put in their own hours but rather rely on others’ tips, then they deserve whatever outcome they get.
I completely agree with your stand. I teach finance and spend much of my time helping my students “un-learn” the falsehoods that they have been spoon-fed for so many years. I feel like half the people out there a running the old “horse racing newsletter scam” where you pick all of the possible winners in the race just under many pseudonyms.
But I’m surprised the number of students who have gotten A’s in A-’s in statistics courses who fall for data snooping, hindsight, confirmation bias, overconfidence,and just plain fraud. Most academics don’t believe that you can earn an alpha, so they don’t equip their students to deal with a world filled with people who offer “alpha”. It would be nice to have a corner of the blogosphere where I could point my students where they can explore alpha-based strategies away from the hucksters.
However, in the real world, access to talent is usually expensive.
unimpeachable integrity in the quest for the truth—-very admirable!
dv
You are to be congratulated for your brave and honest stand ! ! !
Two comments:
1) Don’t take these things too hard, bad for your blood pressure.
2) To the list of things to be fed up about, I would add only the techno-babble, made up of undigested statistical readings . . . and absolutely no comprehension. These also abound. They maskerade as “hard quants”. Some of them claim that they are “too busy doing research” to do the undignified activity of actual trading.
eber
I understand your frustration with Green Faucet, but your beef was with them. Why quit Seeking Alpha as well? I always considered them to be a much higher level of quality than GF. Personally, I like following all the best bloggers at one central hub and am sorry that you are leaving. Not being able to see you there will be a loss. Though I do often jump from SA to its authors’ individual blogs, I don’t have the time or the patience to check out so many blogs on a daily basis. Which means I probably won’t see most, if not all of your posts. I’ll miss them. Good luck to you!
Gee, I wonder if someone from seeking alpha wrote this comment.
Michael, as someone who come from a technical background (systems engineering) i share your concerns 100%. it’s too bad that in business, it’s all about how good of a salesman one is, rather than superiority of one’s product.
Beefing with IBC. Bad move.
You sound really bitter in this post.
If you think he “epitomizes everything that’s wrong with this industry”, you should really say why if you think making a stand will do some net good, otherwise it’s just playground namecalling. It would’ve been a lot more classy to ignore someone you don’t respect — otherwise it just smacks of insecurity.
Hi Michael,
In your previous posting you mentioned the academic practice of peer review and journal publication. Why not try that? Rather than criticizing other bloggers–whom you sometimes allow to remain unnamed in what I take is a sense of compassion on your part–why not write an objective critique of work you don’t like? Of course one reason for not doing so is that it takes a lot of time. To examine someone else’s work and dissect it honestly — rather than emotionally — takes work. But it often pays off in that as a reviewer you will (probably to your own surprise) learn something simply by going through the process of writing the review.
This is not to say that I will criticize you if you don’t do it. I’m sure you have lots of other things to keep you busy. But if you continue the practice of providing honest evaluations of others work — along the lines of CXO Advisory — I think you will be helping the financial/trading blogosphere. You will also help clarify the differences between serious work like your own and those other guys. I hope you try it.
RE to Blue: not the same…when the blog/site is making a real attempt at provided information I’ve taken a very empirical approach (ex. http://marketsci.wordpress.com/2009/01/09/roundup-testing-tradingmarketscom%e2%80%99s-10-trading-rules/).
When the blog/site claims (in hindsight) to be making a gazillion % a day AND is leading rookie traders off cliffs as a result (a’la Cramer), I have no patience. If you’re tapped in to the boys of iBC sans Woodshedder (or duc’s blog) you know what I mean. I wouldn’t devote space on my blog to debunk Cramer and I won’t here. Know what I mean?
michael
P.S. In reviewing other blogs you might ask and answer questions like this.
o What specifically don’t I like about this blog?
o What could the author do to improve it?
o What would make the blog more believable?
o What would make the blog more useful to the average reader?
o And in general, what specifically could the author do so that you would change your opinion about this blog and category it as worth reading?
A review like that not only clarifies what in your view is wrong with the blog, it also forces you to write down your criteria for valuable blogs. I know that your criteria include audited results and actionable advice. But I’ll bet there are lots of blogs that you like that aren’t audited — and that don’t primarily offer trading advice. So for any specific blog, can you explain what it is about it that keeps it from being a useful blog — and how in your view the author should go about fixing it.
Nice move.
You MUST admit, though, that The Fly is pretty darn entertaining… A good trader? I don’t know… but darn entertaining.
RE to scrilla_gorilla: agreed…actually, The Fly is on my RSS reader. Not for anything trading-related mind you, but for the bravado…it’s like watching a car wreck. michael
Michael,
I dont suppose I can get you to stop mentioning TradingMarkets
to boot can I?? ; )
RE to Red: I know, I know, they’re my quintessential “somewhere in the middle” example. I’m not sure from your msg if you’re pro or against TM, but I like that those guys at least attempt to take a quantitative approach (and my previous reviews were mostly positive)…I just don’t like all the sales fluff that comes with it. Okay, last mention. michael
This has nothing to do with your being outed as the guy behind Zero Hedge, does it?
ROFL…well done Bil – that’s going to be my new response to ever trader rant I read. michael
Forgive me for being a little confused here. I’ve been following (as in, “reading”) “that guy” on IBC for quite a while, and he’s been posting his trades in real time – both entries and exits, so they are verifiable/plausible to that extent. He appeared to be doing very, very well. Judging from comments posted by other readers who did actually ride his trades (which he discouraged), they were also sharing in his success.
He’s also been pretty clear and consistent with his analyses, and also his answers to people’s questions. Furthermore, his analyses seem consistent with recognized techniques & principles espoused or published by various “accepted” TA authorities… and it all seems consistent with the series of basic TA guides that he has written (and provides on his website at no cost). He also repeatedly warns, even disses, people who try to blindly follow him without knowing what their doing (e.g., no exit strategy) – which seems responsible.
In short, everything I’ve seen about him seems to be consistent, plausible, reasonably verifiable, responsible, transparent and sensible.
So I’m not sure I understand your beef with him. Are you accusing him of somehow falsifying his trades… or pumping-n-dumping… or ??? Because so far, from what I’ve seen, he seems to be walking the talk.
Wow!!! Michael must have been eating his grumpy cookies or his ornery cake yesterday morning!!
On a serious note, I believe Mike’s post and the comments in this thread represent the start of a serious and long overdue evaluation of faux traders and trading companies. The internet has made communication to the masses unbelievably easy. As proof I point to my e-mail log where I have been promised cheap gold watches, timeshares at below cost, and male enhancements that are physiologically impossible. But I digress. The point is that the internet has spawned literally thousands of trading experts who are touting fictional expertise, for a price. Chart Addict’s results are not only not verifiable, many of the trades themselves are impossible if one compares the claimed trades to the tape for that day and time. But Chart addict is just one of the many, and perhaps not even the worst.
As I have learned the hard way, when walking through the pastures of the marketplace, beware of the bull shit.
Good post Mike, and happy trading.
p.s. Now get back to work!!!
I don’t get it. Chart Addict is a teacher and the guy doesn’t lie. I’ve learned more from him than anyone else and he’s allowed me to bank some serious coin while I do it. I agree wholeheartedly that there are fools blogging and if you follow them you’ll lose your ass, but… Chart Addict ain’t one of those guys. Of all the popular fin bloggers, why in the world would you call out the only one who actually plays the game transparently?! He’s the real deal…
RE to lillian: with all due respect. Transparency is an independently-verified track record that accounts for precise execution price, transaction costs, and slippage. Anyone who manages money can provide that. Anyone who refuses to do so yet makes claims of gazillion % gains is implicitly a snake oil salesman. michael
why in the world can’t you just look at his trades? he calls entries and exits – i do not understand why a formality matters?
RE to lillian: I’ve been in this business of managing money for a brief spell.
If I told a third-party firm to look at my twitter log or my blog and trust me I would get laughed out the door. I reiterate my previous response:
Transparency is an independently-verified track record that accounts for precise execution price, transaction costs, and slippage. Anyone who manages money can provide that. Anyone who refuses to do so yet makes claims of gazillion % gains is implicitly a snake oil salesman. michael
Interesting food for thought. I firmly agreed with Lillian. In everything he has said and done he has come across as responsible and measured. I agree that his trades cant be independently verified. But then again there is no compulsion on any of us to do so whether we are selling something or not. I sell my services at work on the basis of an interview and a reference of my choice. It is up to the buyer to decide whether I’m the real deal.
Ducati really gets into the nitty gritty. And somewhere in there lies the answer. I dont feel he succeeds in nailing him. Though he certainly casts significant doubt.
Really interesting perspective gents. I will watch for further developments.
Bravo for your stand! Couldn’t agree more. If the blog-aggregators aren’t providing editorial or some qualitative filtering, what’s the point?
The Fly is for entertainment only. Back in the old days when it was just the Fly blogging, the comment section was a riot and had some decent idea exchange.
IBC is now populated with lunatic fringe bloggers who add no value except to insomniacs.
Chart Addict has posted a response, including links to his Covestor accounts which provide independent, third-party verification of his results. He also has issued you a challenge to trade against him for a week with real-time, verifiable trades to be seen by all. In all fairness, and with all due respect, I think you owe it to everyone to either issue a retraction, or take him up on that challenge. So far, from what I’ve seen, he’s always put his money where his mouth is. I have read your criticisms, checked out Ducati’s blog, and also followed Chart Addict on a daily basis. Thus far, I have no reason to doubt that he’s the real deal.
http://ibankcoin.com/chart_addict/2009/08/20/important-matters-to-discuss-real-time-profitable-calls-sf-ms-real-3rd-party-auditing-michael-stokes-epic-failure-etc/
RE to HI5: I’ve done a little bit more than that, I’ve promoted his work: http://marketsci.wordpress.com/2009/08/20/well-done-mr-lee/
michael
P.S. both sides of my family grew up in Hawaii (military brats) – where abouts you from?
I’m from “Town,” i.e., Honolulu.
Although I wasn’t previously acquainted with your blog, from what I can see, I honestly respect your intentions as far as trying to spare investors – especially novice ones – from being misled or even scammed. There’s a need for people like you to be advocates for the “innocent,” to question, to challenge. Not enough people do.
As I’ve mentioned, though, I have been following CA for some time, and while he does occasionally talk a big game – so far, he seems to be able to back it up. I respect that, as it isn’t uncommon in people who are both highly competitive and high achievers. As long as they can back up their words – hey, to me, that’s the bottom line. He also seems honestly willing to share his knowledge with people who truly want to learn. He doesn’t just post his trades – he’ll go into Q&As, the reasoning behind trades, methodology, etc., and has shown quite a bit of patience with even rookie traders who are earnest.
I have an admitted bias for anyone with ties to Hawaii. “Gio” on iBC also lives here, and is another of their gang who I have a lot of respect for. Like CA, he also seems very willing to share his knowledge, teach, etc. – and again, from what I can tell, seems to be doing quite well with his trading.
I also understand that you’re not trying to “debunk” people, but rather promote objective means of truly “separating the wheat from the chaff.” Even if you may disagree with how verifiable or transparent guys like CA have been, however, I continue to believe that he is the real deal — at the very minimum, someone from whom most traders could stand to learn a lot from.
Aloha, and best wishes. I’m happy to discover your blog, and will continue to check in.
RE to HI5: pleased to make your acquaintance and thanks for the thoughts (really). Civil discourse + impassioned beliefs = change (or something like that).
I can’t claim too much connection to Hawaii any more. I’ve lived abroad b/t Asia (Taiwan mostly) and mainland for quite a while. My remaining HI family is all spread out on the big island (we manage to stay country no matter where we go). Take it easy…michael
I think the fact that Seeking Alpha features Cramer front and center says it all