Investment Strategy

My template for trading Biotech stocks

Disclaimer: The information contained in this article is not and should not be construed as investment advice. This is my investing journey and I simply share what I do and why I do that for educational and entertainment purposes. To understand what follows, it will be helpful if you have studied options and performed research on the biotech sector before, but it is not required. You simply need an open mind and a healthy amount of curiosity. It would also be beneficial if you familiarize yourself with my previous work on derivatives. This article does not directly build on those linked below, but they are helpful context to understand how I think about convexity and volatility…

a year ago · 10 likes · 3 comments · Fallacy Alarm

My template for trading natural gas futures

Disclaimer: The information contained in this article is not and should not be construed as investment advice. This is my investing journey and I simply share what I do and why I do that for educational and entertainment purposes. is an ETF that buys natural gas futures with leverage and rolls them at the settlement date. As I will explain below, the term structure of natural gas futures is typically upward sloping (contango). This creates negative drift for the ETF as it regularly buys expensive futures contracts and rolls them at a lower price later. There is a systematic reason why this has to have a negative payoff over time which can be exploited. In this article, I will explain why…

a year ago · 6 likes · 5 comments · Fallacy Alarm

Tracking Fiscal Flows in REAL TIME

Disclaimer: The information contained in this article is not and should not be construed as investment advice. This is my investing journey and I simply share what I do and why I do that for educational and entertainment purposes. Summary Going forward, I will closely track and analyze US Treasury deficit spending to observe and anticipate turning points and inflection points that carry market signal. This is the logical next step for me after pounding the table all year long about how fiscal stimulus has become the primary asset price driver…

a year ago · 8 likes · 2 comments · Fallacy Alarm

Liquidity Provision Risk Premium and the Cost of Leverage

Have you had enough of macro? I certainly have. Let’s do something else for a change. :) This article is short and sweet, but it is also extremely information dense. I recommend reading it when you have a peaceful moment on your computer (as opposed to reading it on the phone) and it will help to open the underlying Excel model which I have attached for premium subscribers. For free subscribers, I have added screenshots throughout to facilitate following my thoughts…

2 years ago · 6 likes · 3 comments · Fallacy Alarm

Who and what is Fallacy Alarm?

I have maintained an ‘ideas’ diary for many years to document my thoughts and how these evolve over time. There is something magical about getting thoughts into a concise and precise manner. For me, this works best in written form. Over time, this ‘ideas’ diary morphed more and more into an ‘investment’ diary, which has helped me structuring my thoughts …

3 years ago · 7 likes · Fallacy Alarm

A measuring stick for the markets

The 2020/21 rally in stock prices, and asset prices more generally, has left many people confounded. Especially, since many people felt that the base in Feb’20, the eve of the Corona Crash, was already significantly inflated after the 2010s run. This routinely leads to a doomsday debate in financial markets every time there is a correction with the lead…

3 years ago · 3 likes · Fallacy Alarm

The Compounder-Victim-Model

The market is not rigged, it just rewards those who put in the time and effort “Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot…

3 years ago · 15 likes · Fallacy Alarm

Inflation won't stop asset prices in the 2020s

I believe the current inflation debate and its presumed consequences on asset prices is misguided. There are strong signs that a large component to the current inflation wave is cyclical in nature and will eventually roll over without distinct monetary intervention. And even the structural component to it is difficult to battle for central banks because…

3 years ago · 5 likes · 5 comments · Fallacy Alarm

The importance of identifying inflection points in growth stock investing

When does disruptive innovation take off? When does the stock of a disruptor leave its trading range to initiate a powerful and lasting bull run that will not turn out to be a bubble? What differentiates AMZN from SE? Or TSLA from PTON? Or GOOG from PTIR…

3 years ago · 14 likes · 6 comments · Fallacy Alarm

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