Ho John Lee’s Weblog

• Mr. Picassohead
  Create your own Picasso-style portrait by placing selected shapes and colors.
  (tags: art flash picasso fun random)

A few days ago, the first time I saw the television ad for the new Volvo S80’s heartbeat sensor alarm, I thought it was a parody. It shows a woman walking up to her car in a dark parking lot, then turning away after the heartbeat detector shows that someone is hiding in her car. I’m sure they test marketed this before including the feature, but I totally don’t get it.

Here’s what the Volvo site says about the feature:

The Personal Car Communicator (PCC) is your car key’s smart connection with your Volvo S80 applying the latest in two-way radio technology. When in range, you’ll always know the status of your car. Locked or unlocked. Alarm activated or not. If the alarm has been activated, the heart beat sensor will also tell you if there is someone inside the car. The PCC also includes keyless entry and keyless drive.

I’m currently in the top 4% at 14746 in the CNBC contest. Oddly, they don’t publish the portfolio values on their website, but did show the current portfolio values and standings on TV last Friday. The top positions are clustered around $2M, or a total return of around 100%. It would be interesting to know what the distribution of 1-week returns looked like. That’s probably the best opportunity for placing at this point.

In either case, I haven’t hit any 25% to 50% movers, which looks like a prequisite for placing in the standings so far.

This weekend appears to have been the start of allergy season for me. As a consequence, I get to try the new over-the-counter decongestants. The old ones (Psuedophed etc) were apparently being purchased in large quantities to be crushed and used for producing methamphetamine, so now when you go to buy them you need to register at the pharmacy desk, show your drivers license, where they check with a state-wide database to make sure you haven’t exceeded two packages for the month.

This process takes a long time and is actually more difficult than getting a prescription filled (since you can’t call ahead). So I’m trying the new decongestants. The main drawbacks so far are that they don’t have the 12- and 24-hour extended release versions, and they also don’t seem to work very well. On the other hand, I can run in and out of the store to get them, rather than waiting for 10-15 minutes at the pharmacy desk while they check my drivers license against their database.

• AnandTech: Apple TV Part 1: Unboxed and Dissected
  Full teardown with photos. Intel low voltage mobile CPU and Nvidia 7300 graphics, 40GB HDD. Sort of like a nicely packaged ultramobile notebook.
  (tags: apple hardware electronics design media video iptv semiconductor investing trends)
• EETimes.com - Hynix-SanDisk: what it means
  On the MLC NAND flash business following SanDisk’s resolution of IP licensing to Hynix and new partnership.
  (tags: sandisk sndk nand flash consumer electronics market trends)
• France opens up its UFO files - space - 22 March 2007 - New Scientist Space
  French national space agency unveils a website documenting more than 1600 UFO sightings spanning five decades.
  (tags: france ufo science geek culture)
• French UFO files from CNES
  French national space agency website documenting more than 1600 UFO sightings spanning five decades. Appears to be overloaded with requests due to launch publicity.
  (tags: france ufo science geek culture)
• How-to: Upgrade the drive in your Apple TV - Engadget
  Step-by-step instructions to upgrade from the factory shipped 40GB to 120GB drive in the new Apple TV gadget.
  (tags: apple hardware howto hacking)
• OneOption | Favorites
  Assorted prebuilt stock scans based on different setup criteria
  (tags: stock trading tools)

• 1-800-Phone Number Comments
  User contributed database identifying assorted 1-800-xxx-xxxx numbers. Telemarketers are supposed to identify on Caller ID, but often don’t, and often ignore Do Not Call lists.
  (tags: telemarketer phone numbers database consumer resource)
• Hawaiian Reef Fish guide card (PDF)
  1-page guide for identifying tropical reef fish found in Hawaii.
  (tags: hawaii travel snorkeling fish nature)

• YouTube - Jim Cramer and Stockwire.com
  10 minute interview at the end of 2007 on market dynamics, hedge funds, misdirection, and price manipulation using futures, rumors, and trading capital.
  (tags: stock market trading tactics hedgefund financial culture)
• These Boots Were Made for 22 M.P.H. - New York Times
  Awesome, yet probably useless Russian gasoline-powered running boots. Looks like it would be something like running on powered Romper Stompers.
  (tags: running hacks russia science random)

• I Lost $700,000 in three months - The Electric New Paper, Singapore
  Starting with $300K from friends and family, after some initial gains, university student has now lost about $700,000 in recent volatility.
  (tags: stock trading markets volatility risk management)
• Twittering Your Home - O’Reilly Mac DevCenter Blog
  Hacking together home automation with Twitter messages.
  (tags: twitter hacking automation ideas)

• The carry-unwind’s potential effects: Deflation abroad.
  A scenario - what would happen if the JPY carry trade unwinds in a big way?
  (tags: global economics finance markets forex stock trading ideas trends)
• Inflation, Deflation, Real Estate, The Dollar and Their Effect On Equities • dummyspots.com
  We have an economy frothing with money, but no growth to speak of… an economy that’s trying to stall in spite of all the excess money. What happened to all that money, and where’s the inflation?
  (tags: economics finance markets federal reserve monetary policy investment trading ideas trends)

I recently went for my two-year followup to see how my eyes are doing after wavefront LASIK. At the initial exam and each followup visit, they measure the point spread function of your eye. Here’s a before-and-after.

The scale of the two graphs are different, so the improvement is even better than it appears at first glance. The upper plot corresponds to roughly 20/80 vision. The lower plot, two years later, is at 20/15.

• TraderFeed: Two Deadly Sins In Trading
  A reminder that volatility doesn’t always mean opportunity, and to stick with larger positions in better setups rather than small positions with vague setups.
  (tags: stock market trading tactics risk management)
• The Project Gutenburg eBook of, Triplanetary by E. E. Smith
  A classic from the early days of space opera. I remember getting the whole Lensmen and Skylark series for a couple of dollars at a used book store when I was in high school.
  (tags: free book ebook science fiction classic culture)

It’s hard to find high volatility stocks that are likely to move up in this market. I made a little progress on the CNBC stock contest, but this is going to be a lot lower tomorrow when they update the results (seeing how the markets had another abysmal day). It would be a lot more interesting if you could take short positions. Everyone would probably be in NEW and LEND.

As an aside, the rules for the trading contest apparently don’t prohibit multiple accounts owned by the same person. Consequently, someone named “Nancy Beaumont” has entered hundreds of portfolios. By the rules, they can only win once, but having multiple high-volatility portfolios in the running significantly improves your chance of ending up with one or two successful outliers, sort of like buying multiple lottery tickets, but with much better odds. At the moment they’re occupying 8 of the top 20 rankings.

• Bloomberg.com: Asia - Indian Crime Ring Targeted Google in Online Fraud
  …The men bought stocks and options, then hijacked online accounts to purchase the same securities and drive up the prices.
  (tags: stock online trading fraud risk management)
• The Raw Story | Three Indians charged with hacking into US brokerage accounts
  Acorda Therapeutics, IGI Inc., Earth Products & Technologies, Image Entertainment, Investors Capital Holdings Ltd., Conversion Services International, Pressure BioSciences, Accelr8 Technology Corp., CTR Investments & Consulting, Sun Microsystems, Citizens
  (tags: stock trading fraud risk management)
• The Tech - Student’s Race Complaint Undecided For Princeton
  MIT Dean of Admissions Marilee Jones said, “It’s possible that Henry Park looked like a thousand other Korean kids with the exact same profile of grades and activities and temperament … yet another textureless math grind.”
  (tags: education society asian korean american culture)
• The Daily Princetonian - Joke op-ed sparks ire, controversy
  The column begins, “Hi Princeton! Remember me? I so good at math and science. Perfect 2400 SAT score. Ring bells?” It also refers to “yellow people” who “cook greasy food, wash your clothes and let you copy our homework.”
  (tags: education society asian american culture)

• Asia Sentinel - Tracking the North Korean Supernote
  On high quality counterfeit $100 dollar bills from North Korea. The going rate in China is 30-50% of face value, but professional money handlers can still spot them.
  (tags: global travel currency northkorea korea china money culture security random)
• Create your Google Sitemap Online - XML Sitemaps
  Free online sitemap generator.
  (tags: web sysadmin software tools xml sitemap generator)
• Articles/Papers on asset allocation and investment strategy
  An interesting reading list on portfolio management, geared toward an institutional perspective.
  (tags: investment strategy asset allocation risk management finance investing reference)
• Global Diversification (PDF) - Statman, Scheid
  March 2004 paper by Meir Statman and Jonathan Scheid examines correlation, standard deviation, and dispersion in diversified investment portfolio returns.
  (tags: investment portfolio global asset allocation risk management finance quantitative)

• Forecasting International Equity Correlations (PDF)
  Claude B. Erb, Campbell R. Harvey, and Tadas E. Viskanta. A look at the changes in cross-country correlation during recessions vs growth. (Correlation is higher during recessions.)
  (tags: global asset allocation investment finance quantitative risk management)
• FRB: Speech, Warsh–Market Liquidity: Definitions and Implications–March 5, 2007
  …I wish to advance a simple proposition: Liquidity is confidence…What if the current level of liquidity caused lower risk premiums than could be justified by actual credit risks? Might a misallocation of resources result?
  (tags: federal reserve monetary policy finance economics investing)
• Portrait Retouching Gallery
  Sample before-and-after portrait photos using semi-automatic retouching application instead of Photoshop.
  (tags: photo retouching digital image software photoshop photography culture)

CNBC is running a stock trading contest starting today, with a prize of one million dollars for the best performance by May 25th. Signing up is free. Each participant gets a notional $1,000,000 to trade. There are a few non-obvious rules:

• All trades are priced at end-of-day - no intraday trades, and no GTC limit orders.
• No ETFs - this means no indexes, countries, sectors, or commodities, and no inverse trades
• No mutual funds - again, no indexes, country, sector, commodity, or inverse vehicles
• No options, futures, or other derivatives
• Minimum market cap of $500 million as of the starting date - this is probably to keep people from winning by manipulating a thinly traded microcap stock.

In order to win this type of contest, you pretty much have to treat it like a free lottery ticket and make your selections accordingly. There is no risk-adjusted return to consider, and no downside to taking extreme losses. So on a short timeframe, and in a long-only US stock portfolio, you’re looking for something highly speculative that’s going to move a lot.

• The whispering gallery of Grand Central Terminal
  I’ve been through Grand Central many times and never knew about this particular feature.
  (tags: travel newyork science random fund)

We caught the moonrise this evening to check out the lunar eclipse. Unfortunately the west coast is on the tail end of the region in which this one is observable, so there wasn’t too much to see. A nice deep yellowish color as it came up, but if you weren’t looking for it you might not have noticed anything other than a full moon. I wasn’t motivated enough to try shooting a photo that would come out visibly different than a normal moonrise photo. It would probably be more visually representative to take a regular photo and tweak the color in Photoshop.

On the other hand, it did precipitate a fun dinner discussion about solar and lunar eclipses, and what it would look like on the moon. I don’t think they’ve been doing much astronomy in 5th grade this year.

• All About Alpha » “Accidental Alpha”
  On a paper by Fung and Hseih on modeling hedge fund performance. Hedge fund returns, they say, can be represented by a weighted average of portfolio trading strategy returns.
  (tags: hedgefund investment trading strategy quantitative finance trends research)
• Will Hedge Funds Regress towards Index-like Products? (PDF)
  William Fung and David A. Hsieh, January 2007. Introduces a model for hedge fund performance based on linear combinations of underlying non-linear trading strategies.
  (tags: hedgefund investment trading strategy quantitative finance trends research)

• DRAMeXchange — Price, Transactions, and research inside DRAM/Flash industry
  Spot and contract price quotes and charts for memory chips.
  (tags: semiconductor commodities market chips electronics components investment finance research data)
• Lenovo Support & downloads - Battery recall
  Service note and diagnostic tool for IBM/Lenovo Thinkpad battery recall.
  (tags: ibm lenovo thinkpad battery recall sysadmin)
• Lenovo recalling 200,000 Sanyo Thinkpad batteries - Engadget
  More info on the IBM/Lenovo Thinkpad battery recall. My notebook batteries aren’t on the list, so my desk is unlikely to spontaneously combust.
  (tags: ibm lenovo sanyo thinkpad battery recall)
• The Venture Capital Approach to Finding and Driving Innovation (PDF)
  Gilman Louie overview of how VC works, presented January 4, 2007 at Hawaii International Conference on System Sciences
  (tags: vc entrepreneurship venture funding startups management investing)
• NYSE Group, Inc. > About NYSE Group > News & Events > Media Resources > Media Resources
  Current levels for market circuit breakers - program trading restrictions and general trading curbs. Updated quarterly. Hit the 180 point trading collar twice so far this week.
  (tags: nyse stock market trading risk management)
• Calculating Value-at-Risk (PDF)
  William Fallon 1996 paper on model assumptions and approaches to calculating value-at-risk for asset portfolios.
  (tags: finance stock option investing asset allocation quantitative risk management probability theory)
• The Effect of Mis-Estimating Correlation on Value-at-Risk (PDF)
  Vasiliki D. Skintzi, George Skiadopoulos, Apostolos-Paul N. Refenes. Examines the effect of mis-estimated asset correlation on value-at-risk. Predictably, bad inputs lead to bad outputs.
  (tags: finance options stock investing asset allocation quantitative risk management probability theory)
• Intraday Value at Risk (IVaR) Using Tick-by-Tick Data with Application to the Toronto Stock Exchange (PDF)
  Georges Dionne, Pierre Duchesne, Maria Pacurar, December 2005. A VaR approach to measuring intraday market risk for short term and day trading. Seems to me that it would only work in very liquid markets.
  (tags: finance investing options stock trading asset allocation quantitative risk management math probability theory)
• Berkshire Hathaway - Shareholder Letters
  Archive of Warren Buffett’s annual letter to shareholders reviewing the past year. The review for 2006 just posted today.
  (tags: finance investing business culture)