Podcasts about equity anticipation securities

Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: My simple AGI investment & insurance strategy, published by lc on March 31, 2024 on LessWrong. TL;DR: Options traders think it's extremely unlikely that the stock market will appreciate more than 30 or 40 percent over the next two to three years, as it did over the last year. So they will sell you the option to buy current indexes for 30 or 40% above their currently traded value for very cheap. But slow takeoff, or expectations of one, would almost certainly cause the stock market to rise dramatically. Like many people here, I think institutional market makers are basically not pricing this in, and gravely underestimating volatility as a result. To take advantage of this, instead of trying to buy individual tech stocks, I allocate a sizable chunk of my portfolio to buying LEAPS (Long-term Equity AnticiPation Securities) at high strike prices and faraway expiration dates on these indexes. If a slow takeoff does happen, and public companies capture some of the increased productivity, I'll at least be duly compensated for it when my skills become worthless. If it doesn't happen, this part of my portfolio will vanish, but that seems like an acceptable risk given the upside. I started doing this in January,[1] and so far the mark price of the basket of options I've bought has doubled.[2] FAQ The options contracts you're talking about expire in "two to three years". Does this strategy only make sense if you think visible slow takeoff will begin before 2027? That's not quite necessary. If large parts of the economy get automated "only" in 2030, near-term AGI progress could start to impress market makers enough that they "wake up" and increase the price of these securities and options in anticipation of a boom. Which is why I choose to buy now instead of closer to my expected timelines, while Nvidia is only a two trillion dollar company and my alpha on this could run out any given year. But I think takeoff before 2027 is possible. As a layman, the simplest argument for shorter timelines I can empathize with is that GPT-3 was released in 2020, GPT-4 was released in 2023, and prediction markets expect GPT-5 to release later this year. That plus the enormous amount of capital investment in AI makes me think that there's a possibility of large portions of software engineering getting automated soon, which would precede further speedups. Why not buy futures instead of options, if your thesis is about the next ten years rather than the next three? Futures involve lots of leveraged downside risk. If the timing is wrong, I could lose a lot more money with futures than I can with options. On the other hand, if I'm right and GDP starts speeding up dramatically, then the deep OTM call options will be more valuable than futures contracts. The only benefit to futures is that I would get more than zero percent of my investment in the "sane" scenarios where Nasdaq and the S&P 500 rise gradually but not the stratospheric amounts I expect. That probably only happens if AGI isn't here, in which case I'm agnostic about the performance of these indices and don't really have a thesis either way. What is money going to be worth to you post-AGI anyways? Possibly a lot. First, I expect there to be large returns before any kind of catastrophe happens. Some of those returns could be directed toward either alignment research or high-leverage political opportunities, maybe to greater effect than the opportunities I have now. But also, from my vantage point I think there's a strong chance that: RLHF (and trivial improvements on RLHF such as DPO), along with some workshopping, turns out to be broadly sufficient for AI alignment. Existing property rights get respected by the successor species. There is no significant wealth redistribution, and the vast majority of the lightcone will go to people with absu...

Link to original articleWelcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: My simple AGI investment & insurance strategy, published by lc on March 31, 2024 on LessWrong. TL;DR: Options traders think it's extremely unlikely that the stock market will appreciate more than 30 or 40 percent over the next two to three years, as it did over the last year. So they will sell you the option to buy current indexes for 30 or 40% above their currently traded value for very cheap. But slow takeoff, or expectations of one, would almost certainly cause the stock market to rise dramatically. Like many people here, I think institutional market makers are basically not pricing this in, and gravely underestimating volatility as a result. To take advantage of this, instead of trying to buy individual tech stocks, I allocate a sizable chunk of my portfolio to buying LEAPS (Long-term Equity AnticiPation Securities) at high strike prices and faraway expiration dates on these indexes. If a slow takeoff does happen, and public companies capture some of the increased productivity, I'll at least be duly compensated for it when my skills become worthless. If it doesn't happen, this part of my portfolio will vanish, but that seems like an acceptable risk given the upside. I started doing this in January,[1] and so far the mark price of the basket of options I've bought has doubled.[2] FAQ The options contracts you're talking about expire in "two to three years". Does this strategy only make sense if you think visible slow takeoff will begin before 2027? That's not quite necessary. If large parts of the economy get automated "only" in 2030, near-term AGI progress could start to impress market makers enough that they "wake up" and increase the price of these securities and options in anticipation of a boom. Which is why I choose to buy now instead of closer to my expected timelines, while Nvidia is only a two trillion dollar company and my alpha on this could run out any given year. But I think takeoff before 2027 is possible. As a layman, the simplest argument for shorter timelines I can empathize with is that GPT-3 was released in 2020, GPT-4 was released in 2023, and prediction markets expect GPT-5 to release later this year. That plus the enormous amount of capital investment in AI makes me think that there's a possibility of large portions of software engineering getting automated soon, which would precede further speedups. Why not buy futures instead of options, if your thesis is about the next ten years rather than the next three? Futures involve lots of leveraged downside risk. If the timing is wrong, I could lose a lot more money with futures than I can with options. On the other hand, if I'm right and GDP starts speeding up dramatically, then the deep OTM call options will be more valuable than futures contracts. The only benefit to futures is that I would get more than zero percent of my investment in the "sane" scenarios where Nasdaq and the S&P 500 rise gradually but not the stratospheric amounts I expect. That probably only happens if AGI isn't here, in which case I'm agnostic about the performance of these indices and don't really have a thesis either way. What is money going to be worth to you post-AGI anyways? Possibly a lot. First, I expect there to be large returns before any kind of catastrophe happens. Some of those returns could be directed toward either alignment research or high-leverage political opportunities, maybe to greater effect than the opportunities I have now. But also, from my vantage point I think there's a strong chance that: RLHF (and trivial improvements on RLHF such as DPO), along with some workshopping, turns out to be broadly sufficient for AI alignment. Existing property rights get respected by the successor species. There is no significant wealth redistribution, and the vast majority of the lightcone will go to people with absu...

Today on @ChosenGenerationRadio Dan Perkins author, speaker, columnist, TV and Radio personality Expert on Energy and Foreign Policy. What is Iran up to now? They continue to issue threats and warnings and the Trump Administration is able to bark right back. Dr Tom Barrett will be teaching on the benefits of using LEAPS options. The term stands for “Long-term Equity AnticiPation Securities,”Dr Tom with over 35 years of investment experience will explain how they can be used. John Milkovich, Attorney Author of Robert Mueller Errand Boy For the New World Order, what was Mueller doing when he sent the letter ahead of AG William Barr's testimony? What might we expect in Mueller's testimony? Should President Trump allow Mueller to testify?

Ka Pang is probably one of Tyrone Jackson’s most curious students. He is a successful graphic designer turned stock market trader. Born in Hong Kong, Ka came to the United States when he was ten years old. His parents were in the restaurant business and didn’t know much about the stock market. Ka enjoyed working and started to save money. Eventually he graduated to the thought: what do you with that money, other than spend it? When it came to the stock market, Ka lacked a good system; everything was trial and error at first. When he joined The Wealthy Investor Program he learned a disciplined system, which he says simplified and slowed down the game for him. That discipline consists of how you allocate your portfolio, how many options to purchase, knowing to always going back to the covered call, and having x number of strategies to employ when the stock market changes. Even just learning to always choose a stock that is in an upward trend, has 4 quarters of top line revenue growth, and pays a dividend changed the game for Ka. When Ka entered Tyrone’s Wealthy Investor Program there was a period of just trying to understand everything, almost like learning a new language. He took it one step at a time. Once he understood all the trades and tools in his arsenal, the ah-ha moment was realizing that there is a time and place for each strategy. Once you learn it you want to run out and do it, but the key is learning timing and how to react to the market. Ka has made it all the way through to Tyrone’s Mentor Program, the most advanced level. A lot of people who like to trade options choose to trade shorter-dated options. However, Tyrone teaches his students to trade the longer-dated options, called the Long-term Equity Anticipation Securities, or LEAPS. Ka likes the leverage of these trades, that they are cheaper to get into, and that you can make a lot of money for a small movement in the stock price. You also never know what the market is going to do, so by having a longer-dated trade you have more options as to what you can do in response to the market. Ka’s number one rule is to not lose the money he already has, which makes him a more conservative trader. He will never abandon covered calls because he equates them to owning rental property - it’s like renting out the stock you already own for guaranteed income. Its easy money that he can then use as leverage to purchase LEAPS, which is his favorite trade in a bull market. As long as Ka is bringing in the money to cover his expenses, he can basically consider himself ready to retire. He can picture making up to $15,000 per month just from trading within the next three years. Ka’s advice to beginners is that there’s a certain level of risk, but if you don’t start somewhere, get a mentor, and get the education that you need to at least get exposed to it; you’re never going to go anywhere. People are always complaining about their life but they don’t want change, which is counterintuitive. It’s all in the art of the start. So master that art and get started right now at TheWealthyInvestor.net! If you are ready to follow monthly trades and get in the game, check out WITradeSchool.com.  

Tyrone interviews one of his more advanced students, Patrick Giugliano, about his experience trading so far. Patrick started as an engineer but decided he didn’t want to make a career of it. The medical field spoke to him because he enjoyed helping people. Luckily it is in Dr. Giugliano’s nature to flourish in difficult situations because he chose one of the hardest disciplines of medicine: sleep medicine. Eventually Patrick built a private practice and had a long and successful career. Recently he retired and is happy to make trading his main source of income. Patrick was attracted to the Wealthy Investor program because Tyrone came from a common background, similar to himself. He also appreciates that Tyrone teaches you to trade like the institutions trade. The institutions, or the big money, refers to the banks, college endowments, insurance companies, and hedge funds that trade a million or more contracts at once. These large trades truly affect the market. By understanding why the institutions trade the way they do, an individual can anticipate moves in the market and ride the coat tails of these companies. The first trade that Tyrone teaches is covered call writing because it helps to shift your mindset to see what is possible. Patrick says he doesn’t have a favorite type of covered call because he uses the different types of trades to react to what is happening in the market. For example, in a bull market he would use out of the money calls. On a more advanced level, Patrick is attracted to owning LEAPS, or Long-term Equity Anticipation Securities, because of their extrinsic value and because purchasing a longer option gives you the time to be right. When Tyrone teaches more complex derivatives, which are basically buying longer calls, he teaches his students to buy a lot of time because that call option will go up exponentially as the stock moves up and time becomes kind of like an insurance policy. Patrick uses compounding by going back and forth between the Delta 30 and the Delta 70. At the end of the cycle he ends up with more contracts than he started with. When he gets to the point where he has doubled his contracts, he then buys a stock like Apple or H&R Block and moves his money out of a trading scenario into a long term investment scenario. Planting seeds and making investments to plan for the future is very important. Wealth is a feeling first and when you start to see your account balance rising, it gives you more confidence overall. Patrick’s best trade happened recently. A few weeks ago the stock market went down a record 10,000 points in 5 trading days. Then on one day it dropped almost 1,100 points. Although this sounds bad, there was an opportunity because the big money was buying right back in. Patrick saw that the institutions were bringing the market back up and bought a leap at this moment. On that same day he made $12,000. Getting a financial education has helped Patrick to create a nest egg for his family and still retire from his job. He will trade for the rest of his life because it's exciting, it keeps his mind going, and it funds his lifestyle. Patrick’s advice to new traders is this: the most important thing about the Wealthy Investor program is being able to understand what to do if the market is bullish going up, bearish going down, or if its range bound, so that you can make money no matter what happens. The only way to make money on a regular basis is to be methodical. Even the best traders in the world know that they will only be right 19 out of 20 times, so you have to have a plan. And our Wealthy Investor, Tyrone Jackson, agrees. It’s not about making fast money all the time. We want predictable income. If you want to participate in advanced trades like Patrick Giugliano, you have to start at the beginning. Download Tyrone Jackson’s cheat sheet Millionaire Secrets to start getting familiar with the language of the stock market. Click HERE to download now.

On Profiles & Perspectives, Joe speaks with John Denza and Jeromee Johnson of BATS about the exchange's entrance and evolution in the options marketplace. Also, Joe will cover the ins and outs of LEAPs with Steve Claussen of OptionsHouse and then wrap up with some listener questions. LEAPS and Long-term Equity Anticipation Securities are trademarks of Chicago Board Options Exchange, Incorporated.