TechQuant - Stream of Consciousness


Well-known member
264 52
As a prelude to outlining the course of events which led from my position as a Quant to that of a retail side player I thought I’d share with you quotes I wrote down as significant in that process. They are presented in chronological rather than logical order. Bit like life. I’ve not attributed any of them are some are from people who would wish not to be attributed and I like a clean profile. If anyone is interested in attribution, try google or failing that, ask me and I’ll tell you - if it’s appropriate for me to do so.

• The opportunity of a lifetime must be taken during the lifetime of the opportunity.

• Do what you must do, when you must do it, whether you like it or not.

• Life is not determined by the future, it is determined by this very moment.

• If sense and meaning collide, be content to suspend judgement.

• Information is not the data required to answer the question, but the answer itself.

• For things to happen the way you want, you have to take the right actions at the right times.

• You cant move toward one thing without having to move away from something else.

• One of the tricks to mastery is to stop trying.

• When there is mutual ignorance, confidence indeed is king.

• We run our businesses as a succession of follies interrupted, we hope, by moments of brilliance, or at least, long stretches of competence.

• Reality, as you experience it will conform to your beliefs about how it is.

• Markets influence events they anticipate.

• Looking for significance tends to lend significance to that which is otherwise unremarkable.

• Direct knowing, without conscious use of reasoning, can only come after extensive training and preparation.

• Don't fool around with the masks of reality until you can handle the reality of masks.

• Thoughts are but dreams till their effects be tried.

• Security puts a premium on feebleness.

• Nearly everyone overlooks the significance of the obvious.

• I think I am more intelligent than I am.

• There's no alternative like no alternative.

• We bear our heresies quietly - if we’ve any sense.

• Life is as Simple as You Care to Make It.

• Real Power is the realisation that Presumption of Power is Real Power.

• What you believe Limits you.

• The Great Way knows no difficulties except for those that have preferences.

• Appreciation of the Universe is a matter of the Heart, not the Intellect.

• The ability to cheerfully, easily and comfortably adapt to circumstances when they deviate from expectations is what separates the winners from the whiners.

• The good trades present no barrier to entry.

• The real trouble with this world of ours is not that it is an unreasonable world, nor even that it is a reasonable one. The commonest kind of trouble is that it is nearly reasonable, but not quite. Life is not an illogicality; yet it is a trap for logicians. It looks just a little more mathematical and regular than it is; its exactitude is obvious, but its inexactitude is hidden; its wildness lies in wait.

• It's impossible for your past experience to include all the necessary information upon which to base a model to deal with the exponentially expanded reality the future will comprise.

• When considering societal problems over the long term, news-worthiness is often in inverse proportion to frequency. If problems become commonplace, they are not new - so do not qualify as 'news'. This means the media often guides us to focus on less serious acute problems at the expense of more serious systemic problems. The key part of which is that we are led (probably not just by the media, but by others and even ourselves) focus on less serious acute problems at the expense of more serious systemic problems.

• Stay on your feet.

• There is no point being free to do what you want unless you go ahead and do what you want.

• The most common cause of any problem is failure to explicate the obvious.

• An Englishman's mind works best when it is almost too late.

• Riches do not exhilarate us so much with their possession as they torment us with their loss.

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Reactions: tokyojoe and 2be


Senior member
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Two of the most interesting differences between Quant and retail are that I suddenly care about direction of price and I also now care about time. I want it to ‘go’ in a specific direction and I’d prefer it to do it for quite some time. Back then it was all about locking in miniscule profits on absurdly large positions which existed in many cases for considerably less than one second. When you have the ability to effectively front run large orders which the SEC helpfully assisted us in doing by a swathe of ill-considered regs such a requiring as mandatory a best price fill regardless of size, then it’s very easy to make money by fishing with small orders to test and then head off to the other exchanges to pump and dump before the rest of the order gets there. It was all about speed and code and proximity (it still is of course). As a retail trader you’re out in the cold. You have to invent new ways to look at the same data and decide if you’ve got an edge. You normally find you don’t. Part of the trick, a large part, is not using too much capital to find the answer.
That brings "Flashboys" to my mind.
Even among sharks there is an ongoing activity of biting one another, or lets say activity of "sharing" the spoil. Faster is definitely better:LOL::LOL::)
Interesting. Is SEC their next acquisition?:LOL:
I am sure that Bernard Madoff would approve Virtu to be listed on NASDAQ.

Have enjoyed your posts.
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Established member
874 289
Just happened upon this crackin' thread after being away for a while, it's the best I've read for ages, thank you for these insights TQ


Well-known member
264 52
I was responding on another thread regarding the efficacy of the Double Bottom (and on TA generally if you read between the lines) when it occurred to me there was something else that I thought I should mention. The majority of posts I’ve read so far on this site express a personal opinion. The thing about opinions, as opposed to empirical fact, is that it places the person holding that opinion at the mercy of those who like opinions in others because that means they can exploit that opinion. It is often difficult and sometimes impossible to exploit empirical fact, but opinions are the lifeblood of the financial markets and the institutions which make it their core business. Be wary of anything you read or hear or see. Subject it to the most fearsome tests and checks. Always attempt to pull a hypothesis (that is all opinions ever are) apart. Your own and especially those of others. You need to christen every empirically proven fact you acquire with the sweat of your own intellectual effort before you can comfortably accept it as real ‘knowledge’.

No intent to offend any contributors present or past on this site, but having looked at the currently active membership and then gone back and done a little historical digging around, admittedly not that much, I found there is no relationship I could find between the quality of the content of the post and any other factor that could reasonably be considered. Length of time of member ship, number of posts, posts per day, breadth of subject areas, specificity of subject area, apparent background and provenance, shortness or length of posts, idiosyncratic grammar or style - nothing. The only thing which suggests any comment or opinion might warrant additional effort of research are those which intuitively you feel do. Do not look down upon the 10 post ‘newbie’ or accept without question the 1000 post ‘expert’. Be your own judge.


Well-known member
264 52
Just to set a reality check on the power of opinion and how exploiting it can mean big bucks, back in the first half of the naughties, my outfit was buying CDS on sub-prime mortgage bonds. The opinion at the time was that US house prices wouldn’t all fall all over the US at the same time and that was what would be required to cause a headache to those selling us those CDS. Forget the increasing delinquency rates on the underlying loans upon which the mortgage bonds were raised and forget the smoke and mirrors which was the repackaging of bbb tranches via CDO into aaa class investment assets. The consensual opinion at that time among some hardened financial market players was that house prices would have to fall for them to even consider hedging their increasingly short sub-prime CDS positions. We had carried out enough DD to confirm our suspicions that all it would take for the tower to crumble was for house prices to simply stop rising, they didn’t even need to fall for us to make good. We got in about 18 months too early – there’s no way of knowing when it was going to happen but we knew if we waited until the slit hit the fan nobody would be selling to us. So we paid around 18 months’ worth of premiums on the CDS until, we scored big time. The figures aren’t important. What is important is the underlining of just how important an opinion is to those who hold it so that those who do not, and who base their judgement and their trading decisions on empirical fact, can exploit those holding it.
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