Selling your order flow is akin to telling the buyers of this information how to F**k yourself

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Robinhood may advertise itself as the broker that promotes more financial participation and giving the common people a better chance to succeed in the market with their $0 commission. While it may sound great, ever wonder why the professionals steered clear of it?

Let me tell you the simple reason: Robinhood makes money by selling your order flow. This simply means that your orders, along with the hundreds of thousands of people who use Robinhood, are now known to the rich players (e.g…

It won’t end well for investors rushing in now.

When the GameStop Saga came to light earlier this year, there was a frenzy of talking on social media and also within my personal group of friends. Even some personal friends of mine who were professional traders were dragged into the hysteria. For the last point, needless to say, I was disappointed.

Yes, I know that people on the ground, the main street, the retails, were feeling elated when a professional victim, Melvin Capital, fell from grace and sustained more than 50% loss on this single stock.

There was also huge…

Money Management and Risk Management are considered soft edges

Recently, I was asked by a friend who is doing systematic trading whether I consider “money management” as an edge. He had read online that some considered it not as an edge. But I disagree. And that is the reason for this article.


Photo by Umberto on Unsplash

I think when most people talk about edges, they do not really define them properly. It really depends on who you are talking to. I had worked with Quants who only consider strategies where the probability of the strategies themselves are above 80% and those who will take…

We could be entering into the worst bear market of our generation

I am not an American, but I rejoice with the world when Joe Biden was elected. Like many others, I kept refreshing on the counts and why Nevada’s wasn’t moving. On 9th Nov 2020, Monday, when it was confirmed that Trump had lost the White House, the market cheered and moved up in a straight line.

Then it moved down in almost the same fashion.

As a market participant and having worked as a professional trader in a macro hedge fund and proprietary trading firm, I am calling…

A single class and a single technique which unlocks my ability to write.

Photo by Aaron Burden on Unsplash

A Little Background: I was a Bad Writer

English wasn’t my native speaking language when I was young. I was born into a Chinese speaking family. In fact, during my primary school days, I failed my English composition so consistently that I was placed into a special after-school writing class that only a selected few in the cohort could “honorably” qualify for.

The inherent fear of writing an English essay was real. I never knew if what I wrote will come back with a passing grade. …

A couple of alternative data to gauge a company’s medium-to-long-term health.

A Coffee Chat

I was catching up with an old friend who is currently running a business. We used to work in the same bank working on treasury solutions. At one point in time, we spoke about trading and investments and he mentioned a particular stock that he is interested to put a buy order.

Being actively involved in the financial markets, I was naturally curious about the reasons this particular stock caught his attention: there were some fundamental reasons and also a relative value play against similar companies in the same…

Photo by Stephen Phillips - on Unsplash

I was in an interesting situation not too long ago where my role was to gather data and try to gain insights in the work processes and efficiencies of the operations of certain division of the company.

In this particular use case, the management wants to know why are operating costs up and where are the inefficiencies in the process.

I was probably the best suited person for the job because:

  1. I understood the system, having worked on the development and testing of the said system for more than 5 years.
  2. I understood the business value of the data as…

An Act of Releasing myself

Recently I have been very unhappy with a prolonged sense of injustice, multiple displays of hypocrisy, and outright disrespect for others from a certain person.

The cumulative effect is such that a lot of negativity starts to pent up inside my heart, and my mind was also filled with anger and a strong sense of schadenfreude.

The resulting effects have an impact on my productivity and performance in multiple facets of my life. It clouded my view of the world and caused me much misery. …

“Remember, if the time should come when you have to make a choice between what is right, and what is easy, remember what happened to a boy who was good and kind and brave because he strayed across the path of Lord Voldemort.” — Dumbledore (Book)

“Dark and difficult times lie ahead. Soon, we must all face the choice between what is right and what is easy.” — Dumbledore (Movie)

I present the above 2 quotes from Harry Potter & the Globet of Fire because I am at the stage in my life where I have to make a decision…

The inflation of Accuracy

Today, I want to have a brief talk regarding a predictive analytics use case that I was following up on in my workplace previously.

Use Case: Predicting Options Knock-in/out

A brief introduction to the use case here.

For a financial institution that is provides services to client not dissimilar to a brokerage house, there are work to be done at the back-office end when some events like dividends payout, options exercise and expiry, netting, price fixing, etc. This work varies depending on the type of products and the way market moves. …

YuChao Sng

Business Analyst | Data Analyst | Scrum Master | Programmer | Database Developer | Trader | Banking & Trading Systems Expert

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