Tadas Talaikis's Blog, page 5

Gambler’s Fallacy

Gambler’s fallacy, or Monte Carlo fallacy, is, simply put, a belief that your chances of profit are increasing after series of losses. Or, if something didn’t happen for very long time, that chances magically become higher that it will.

Or, opposite, a belief that probability is equal (50/50), when in reality it is not, like shorting assets that are generating profits, purely on the fact that they are growing.

If the system is independent, i.e. random, then randomness of which is evident only a...

Clustering illusion

The problem with manual trading is that we see patterns where they don’t exist. It’s like staring at the clouds. — Jon Kafton

Clustering illusion is one of cognitive biases, the tendency to erroneously overestimate the importance of small runs in small samples of largely random data and underestimate variability (i.e., seeing phantom patterns).

The largest example of clustering illusion in trading and investing is, of course, — a thing called “chartism” — the use of charts of financial data to...

How to see bigger picture

Photo by rawpixel.com from Pexels

14 years ago I had a technology business that created content websites with a single click, had multiple streams of income — like the “generator”, networks and advertising sales, but had one problem — was dependent and was tied to the Google search algorithms too tightly. So, eventually, after 5 years of pretty successful operation, it all abruptly ended, the last “bad batch” of websites was not profitable anymore.

I had realized the problem when it was “happen...

How to read 200+ books a year

Photo by Chris Lawton on Unsplash

For last 4 years I was reading from 189 to 407 books a year. How? Straight to the point — with audiobooks.

Why I did this?

I love always seeking new things, yeah, I’m easily bored, so why not? Books are great source of new discoveries, and, to my experience, significantly better than video.

What I discovered?

Out from 1000 books, only 1.5% gotten into my top of the top list. Gems are rare, and sometimes pretty hard to discover. See my top below.

With many books you...

The American Empire

Image, The Walking Dead

This is (digested and transformed) summary of the book by Noam Chomsky “Understanding Power: The Indispensable Chomsky”.

This is your last chance. After this, there is no turning back. You take the blue pill — the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill — you stay in Wonderland, and I show you how deep the rabbit hole goes. Remember: all I’m offering is the truth. Nothing more.

Nothing is hidden

Nothing is hidden...

Why not decoupled? Redux is just an event emitter, so any replacement can work as separate module.

Why not decoupled? Redux is just an event emitter, so any replacement can work as separate module.

Damn, I understand you, stuck with similar problems, just not in Angular.

Damn, I understand you, stuck with similar problems, just not in Angular.

MySQL is pretty inefficient choice here, compared with Postgres.

MySQL is pretty inefficient choice here, compared with Postgres. And even Postgres isn’t a good choice.

Never understood why I would want to use MobX, now I see. Thanks.

Never understood why I would want to use MobX, now I see. Thanks.

Introducing BlueBlood Quantitative Trading Strategies Index

Over last several months I was building the system that would help to easier integrate multiple (or rather, any number of) quantitative trading strategies, their components, higher level risk control models, various data collection and trading plugins into one solution (“index”).

So, here I present this proof of concept — one command getting all required data, calculating strategies, statistics of each strategy and resulting index, also generating various visual examinations and getting requir...