I would be grateful for some advice on the direction of my business

[msd23]

Hey guys,

I'm looking for some help with choosing the right focus for my business, as I'm feeling a bit lost right now. I wanted to talk about it with someone, and I think this forum is a great place to do that.

First, a bit about me. I'm quite familiar with the Fastlane model but what I struggle with is the execution. I’m a programmer with over 15 years of experience (running my own web dev business, etc.). A few years ago, I switched to quant finance (systematic trading) using AI/ML. I even got a PhD in this field (because I wanted to learn how it's done, not just for the degree). I'm really good at math, coding, statistics, etc., and I usually find solutions to problems that others find tough in this field. After my PhD, I started working in academia, which I'm not too happy about. The pay is shit, and I struggle with the archaic structures and the publication system. It was never my main goal, just something to help pay the bills while working on what I really want to do, and it doesn't take up too much of my time.

Now, I have a few business ideas in this field, but I'm struggling to choose the right direction. Trying to tackle all of them at once is almost like doing nothing — no real progress in any direction.

Here are my business ideas, in order of my preference:

• Algo trading strategies - There's a big demand in the market for effective trading strategies, automated or not. I often get messages from companies looking for quants with their own systems to trade their funds. I could also license the strategies or trade on my own (raising funds wouldn't be a huge issue). The challenge is that creating a profitable strategy is extremely difficult, bordering on nearly impossible, even for experienced quants. The risk is that I could work for 10 years and never find anything that performs better than a simple buy-and-hold. On the upside, if I did manage to create something successful (as there are examples of individuals and companies who have), the profits could be nearly unlimited.
• Education - In my time in academia, I've seen that the demand for education in this field is also high. I can teach anything from basic coding in any programming language, data science, AI/ML, to quant finance. The market is reachable through selling courses, webinars or training workshops. The issue is it is getting crowded, especially with programming/AI courses. My edge could be the high quality of my courses, as I find many out there to be quite poor. Also, there aren't many courses in quant/algo trading, but the interest in them is limited, as it requires a deep understanding of math/stats and can be a bit boring.
• Writing - I was also thinking about writing books and other materials on these topics. Again, the market here seems a bit saturated. Academic books are good but often dry and hard to get through, even for me. My approach would be to make them more practical and engaging. The downside is that I'm not a natural writer and don't particularly enjoy writing, but I could work on that.
• Services - After spending over a decade in the services business, I have no interest in going back to it.
• Software - Developing software solutions in this field would be a natural fit for someone with my background. However, these solutions can be extremely complex, and I don't have many ideas that could compete with current market offerings.

So, that's where I'm at. I'd really appreciate your thoughts on this. Which direction seems most promising to you? Or if you have any ideas on the needs/value I could offer from your perspective, I'd be more than grateful to hear them.

Thanks a lot,
Jakub

 

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[ZackerySprague]

Execute them. He who executes wins.

 

[Trismigistus]

This is why MJ gives so many things in the book to analyse ideas with. Use the CENTS model, which idea best fits those commandments? Utilize the weighted decision matrix, come up with factors to help weigh your decision then complete the matrix. This is what me and my wife did, follow the analysis then select the idea that beats the rest out in the analysis. No one here can tell you which path to take, no one knows you like you do. Good luck!

 

[Pain Brain]

• Writing - I was also thinking about writing books and other materials on these topics. Again, the market here seems a bit saturated. Academic books are good but often dry and hard to get through, even for me. My approach would be to make them more practical and engaging. The downside is that I'm not a natural writer and don't particularly enjoy writing, but I could work on that.
• Services - After spending over a decade in the services business, I have no interest in going back to it.
• Software - Developing software solutions in this field would be a natural fit for someone with my background. However, these solutions can be extremely complex, and I don't have many ideas that could compete with current market offerings.

So, that's where I'm at. I'd really appreciate your thoughts on this. Which direction seems most promising to you? Or if you have any ideas on the needs/value I could offer from your perspective, I'd be more than grateful to hear them.

Thanks a lot,
Jakub

Hard to say which direction would be most promising. You've got a lot of experience in the field. Given your time as a programmer and web developer, maybe the next step would be to develop your own framework using your own templates and sell as a monthly service? You likely have a lot of reusable code that is compact and refined. A selling point could be ease-of-access and quick performance (unlike WordPress)

I wouldn't be worried about being a natural writer. You're not writing a novel or epic. You're writing to inform.

During college I was yearning for a good resource on Racket programming. Scratch that, nearly the whole class. You probably have a good deal of knowledge on these older languages that students today struggle with.

 

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[msd23]

Yeah, I forgot to mention, I did evaluate these ideas using CENTS framework (Grade My Business Idea: Business Ideas and Opportunities Rated Fast comes in handy) and they all come up pretty close. Algo strategies idea scores best, but it's like hunting for a holy grail.

So what I'm actually looking for here is some general feedback on these ideas from other entrepreneurs (like high risk vs value skewing) or maybe pointing out some values/needs I might have missed.

 

[Andy Black]

Hey guys,

I'm looking for some help with choosing the right focus for my business, as I'm feeling a bit lost right now. I wanted to talk about it with someone, and I think this forum is a great place to do that.

First, a bit about me. I'm quite familiar with the Fastlane model but what I struggle with is the execution. I’m a programmer with over 15 years of experience (running my own web dev business, etc.). A few years ago, I switched to quant finance (systematic trading) using AI/ML. I even got a PhD in this field (because I wanted to learn how it's done, not just for the degree). I'm really good at math, coding, statistics, etc., and I usually find solutions to problems that others find tough in this field. After my PhD, I started working in academia, which I'm not too happy about. The pay is shit, and I struggle with the archaic structures and the publication system. It was never my main goal, just something to help pay the bills while working on what I really want to do, and it doesn't take up too much of my time.

Now, I have a few business ideas in this field, but I'm struggling to choose the right direction. Trying to tackle all of them at once is almost like doing nothing — no real progress in any direction.

Here are my business ideas, in order of my preference:

• Algo trading strategies - There's a big demand in the market for effective trading strategies, automated or not. I often get messages from companies looking for quants with their own systems to trade their funds. I could also license the strategies or trade on my own (raising funds wouldn't be a huge issue). The challenge is that creating a profitable strategy is extremely difficult, bordering on nearly impossible, even for experienced quants. The risk is that I could work for 10 years and never find anything that performs better than a simple buy-and-hold. On the upside, if I did manage to create something successful (as there are examples of individuals and companies who have), the profits could be nearly unlimited.
• Education - In my time in academia, I've seen that the demand for education in this field is also high. I can teach anything from basic coding in any programming language, data science, AI/ML, to quant finance. The market is reachable through selling courses, webinars or training workshops. The issue is it is getting crowded, especially with programming/AI courses. My edge could be the high quality of my courses, as I find many out there to be quite poor. Also, there aren't many courses in quant/algo trading, but the interest in them is limited, as it requires a deep understanding of math/stats and can be a bit boring.
• Writing - I was also thinking about writing books and other materials on these topics. Again, the market here seems a bit saturated. Academic books are good but often dry and hard to get through, even for me. My approach would be to make them more practical and engaging. The downside is that I'm not a natural writer and don't particularly enjoy writing, but I could work on that.
• Services - After spending over a decade in the services business, I have no interest in going back to it.
• Software - Developing software solutions in this field would be a natural fit for someone with my background. However, these solutions can be extremely complex, and I don't have many ideas that could compete with current market offerings.

So, that's where I'm at. I'd really appreciate your thoughts on this. Which direction seems most promising to you? Or if you have any ideas on the needs/value I could offer from your perspective, I'd be more than grateful to hear them.

Thanks a lot,
Jakub

I'm a maths, data, IT guy, but nowhere near your level. I fell onto Google Ads where my data and IT skills puts me way ahead of other Google Ads folks. (I can create Cartesian joins of lists of services and locations and upload thousands of highly targeted ads that send parameters via the URL to dynamic landing pages and generate long-tail leads for local service businesses. Most marketers wouldn't understand what I just wrote.)

Can you apply your skills in areas where it's child's play for you to do what others would find impossible? And make little money making machines?

 

[BizyDad]

Yeah, I forgot to mention, I did evaluate these ideas using CENTS framework (Grade My Business Idea: Business Ideas and Opportunities Rated Fast comes in handy) and they all come up pretty close. Algo strategies idea scores best, but it's like hunting for a holy grail.

So what I'm actually looking for here is some general feedback on these ideas from other entrepreneurs (like high risk vs value skewing) or maybe pointing out some values/needs I might have missed.

So basically You've already talked yourself out of all your ideas... Except systemic trading. You went and got not only a degree, but a PhD in order to do it. The obvious challenges in that arena don't sound like they're all that difficult for you.

And yet, you still haven't started.

If you never do it, you'll probably regret not having to tried considering how far you've gone down the path...

What are you waiting for? Someone to gift wrap it?

If you need permission to get started, I give you permission to get started. Go forth and be prosperous. Help others prosper also.

 

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[StrikingViper69]

Which direction makes the most sense for your current:

• skills
• relationships
• resources
• knowledge
• personal experience

?

It sounds like writing and services can be eliminated.

 

[Kevin88660]

Hey guys,

I'm looking for some help with choosing the right focus for my business, as I'm feeling a bit lost right now. I wanted to talk about it with someone, and I think this forum is a great place to do that.

First, a bit about me. I'm quite familiar with the Fastlane model but what I struggle with is the execution. I’m a programmer with over 15 years of experience (running my own web dev business, etc.). A few years ago, I switched to quant finance (systematic trading) using AI/ML. I even got a PhD in this field (because I wanted to learn how it's done, not just for the degree). I'm really good at math, coding, statistics, etc., and I usually find solutions to problems that others find tough in this field. After my PhD, I started working in academia, which I'm not too happy about. The pay is shit, and I struggle with the archaic structures and the publication system. It was never my main goal, just something to help pay the bills while working on what I really want to do, and it doesn't take up too much of my time.

Now, I have a few business ideas in this field, but I'm struggling to choose the right direction. Trying to tackle all of them at once is almost like doing nothing — no real progress in any direction.

Here are my business ideas, in order of my preference:

• Algo trading strategies - There's a big demand in the market for effective trading strategies, automated or not. I often get messages from companies looking for quants with their own systems to trade their funds. I could also license the strategies or trade on my own (raising funds wouldn't be a huge issue). The challenge is that creating a profitable strategy is extremely difficult, bordering on nearly impossible, even for experienced quants. The risk is that I could work for 10 years and never find anything that performs better than a simple buy-and-hold. On the upside, if I did manage to create something successful (as there are examples of individuals and companies who have), the profits could be nearly unlimited.
• Education - In my time in academia, I've seen that the demand for education in this field is also high. I can teach anything from basic coding in any programming language, data science, AI/ML, to quant finance. The market is reachable through selling courses, webinars or training workshops. The issue is it is getting crowded, especially with programming/AI courses. My edge could be the high quality of my courses, as I find many out there to be quite poor. Also, there aren't many courses in quant/algo trading, but the interest in them is limited, as it requires a deep understanding of math/stats and can be a bit boring.
• Writing - I was also thinking about writing books and other materials on these topics. Again, the market here seems a bit saturated. Academic books are good but often dry and hard to get through, even for me. My approach would be to make them more practical and engaging. The downside is that I'm not a natural writer and don't particularly enjoy writing, but I could work on that.
• Services - After spending over a decade in the services business, I have no interest in going back to it.
• Software - Developing software solutions in this field would be a natural fit for someone with my background. However, these solutions can be extremely complex, and I don't have many ideas that could compete with current market offerings.

So, that's where I'm at. I'd really appreciate your thoughts on this. Which direction seems most promising to you? Or if you have any ideas on the needs/value I could offer from your perspective, I'd be more than grateful to hear them.

Thanks a lot,
Jakub

Whats the difficulty in quant trading specifically for you?

I left the field as a discretionary trader in 2017 (worked in a prop shop for one year) because I see the field as getting increasingly dominated by automated systems built by quants. I switched to sales and advisory (making a living through sales commission and advisory fees). The alternative choice at that time was to pursue advanced post-grads, the path you did. There is no “what if” in the real world and hence I find it interesting to read about in the forum.

My question will be more specific. Is short term mean reversion strategies still “working”? My gut instinct is they are still judging by bloomberg articles on record high bonus during the past two years of quant firms during the high volatility. If they are still “working” to what extend are they monopolized by top firms?

Trading for me is largely an occasional hobby now .

 

[msd23]

Whats the difficulty in quant trading specifically for you?
...
My question will be more specific. Is short term mean reversion strategies still “working”? My gut instinct is they are still judging by bloomberg articles on record high bonus during the past two years of quant firms during the high volatility. If they are still “working” to what extend are they monopolized by top firms?

As I'm more of a researcher, my aim is to develop my own models and build strategies on top of them. The challenge with this approach is that I might not be able to come up with anything successful. Sure, basic models like mean reversion or multifactor portfolio models still work to some extent, depending on the asset class. They seem to work well with cryptos, maybe because big players mostly stay out of them. But, my goal is to outperform these models, using them as benchmarks for my strategies. I guess applying them to trading while I do my research could also be a good temporary approach, as it would help me gain more experience.

... Can you apply your skills in areas where it's child's play for you to do what others would find impossible? And make little money making machines?

Yeah, that's basically the idea, only I'm focusing more on financial markets.

So basically You've already talked yourself out of all your ideas...

I've talked myself in and out of them, several times.

 

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[Kevin88660]

As I'm more of a researcher, my aim is to develop my own models and build strategies on top of them. The challenge with this approach is that I might not be able to come up with anything successful. Sure, basic models like mean reversion or multifactor portfolio models still work to some extent, depending on the asset class. They seem to work well with cryptos, maybe because big players mostly stay out of them. But, my goal is to outperform these models, using them as benchmarks for my strategies. I guess applying them to trading while I do my research could also be a good temporary approach, as it would help me gain more experience.


Yeah, that's basically the idea, only I'm focusing more on financial markets.


I've talked myself in and out of them, several times.

My primary understanding is that most of the profits from quants are still from short term mean reversion tradings.

If you make more than ten intraday trades a day. Even a slight edge will make you highly likely to be profitable in a month. Combine that with leverage and make money like magic. Other strategies that work in longer time frame simply can’t be leveraged with minimal risk.

Of course what I said is just theory. The money are in the details of execution.

Not sure if you are familiar with Ernie chan. He is running a one man show for his fund and writing a lot of books on quantitative trading. I think he hires interns only.

 

[msd23]

My primary understanding is that most of the profits from quants are still from short term mean reversion tradings.

If you make more than ten intraday trades a day. Even a slight edge will make you highly likely to be profitable in a month. Combine that with leverage and make money like magic. Other strategies that work in longer time frame simply can’t be leveraged with minimal risk.

Of course what I said is just theory. The money are in the details of execution.

Not sure if you are familiar with Ernie chan. He is running a one man show for his fund and writing a lot of books on quantitative trading. I think he hires interns only.

Yes, I'm familiar with his books, but I didn’t know he runs a one-man hedge fund. I'll take a closer look at it. Looks like he has similar ideas (quant trading, writing, some teaching).

My approach is more like what Jim Simmons and RenTech were doing — using large datasets, daily frequency, and more sophisticated models. At least, that's the goal. As I mentioned, it might be a good idea to start with something simpler.

 

[Kevin88660]

Yes, I'm familiar with his books, but I didn’t know he runs a one-man hedge fund. I'll take a closer look at it. Looks like he has similar ideas (quant trading, writing, some teaching).

My approach is more like what Jim Simmons and RenTech were doing — using large datasets, daily frequency, and more sophisticated models. At least, that's the goal. As I mentioned, it might be a good idea to start with something simpler.

Ah. You mean Rentec’s Medallion fund?

 

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[msd23]

Ah. You mean Rentec’s Medallion fund?

Yes. Right now it’s probably the best performing quant hedge fund.

I was thinking more about their early days. There’s a great book about them by Greg Zuckerman, “The man who solved the market”. It’s a biography and obviously they don’t share much about their methods, but it’s still a great read.

 

[Kevin88660]

Yes. Right now it’s probably the best performing quant hedge fund.

I was thinking more about their early days. There’s a great book about them by Greg Zuckerman, “The man who solved the market”. It’s a biography and obviously they don’t share much about their methods, but it’s still a great read.

Yes. I read that entire book.

They experimented different strategies and ended up sticking to short-term mean reversion. It is kind of stated in the book that they focus on equities and etf for that kind of trade.

I checked quora and people in the field kind of agree that there is nothing special about their strategy because everyone is doing the same thing. It is the execution, the research, IT infrastructure and coding...all the details that make all the difference.

Their long-term portfolio product that is sold to the customers didn't live up to the expectation of medallion.

Medallion has a scalability issue for them because short-term trading has higher market impact. This is more of a fund for employees only and not open to outside investors.

The founder also has other non-disclosed factors for their business success which are not related to research or IT infrastructure. The founder Jim Simons's two children had mysterious accidental deaths which is just too coincidental.

 

[msd23]

Yes. I read that entire book.

They experimented different strategies and ended up sticking to short-term mean reversion. It is kind of stated in the book that they focus on equities and etf for that kind of trade.

I checked quora and people in the field kind of agree that there is nothing special about their strategy because everyone is doing the same thing. It is the execution, the research, IT infrastructure and coding...all the details that make all the difference.

Their long-term portfolio product that is sold to the customers didn't live up to the expectation of medallion.

Medallion has a scalability issue for them because short-term trading has higher market impact. This is more of a fund for employees only and not open to outside investors.

The founder also has other non-disclosed factors for their business success which are not related to research or IT infrastructure. The founder Jim Simons's two children had mysterious accidental deaths which is just too coincidental.

I really do think they use more sophisticated models. It doesn’t matter though. I’m not trying to copy them (or anyone else), it’s just an inspiration.

I’d rather starve than do what everyone else is doing

 

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[Two Dog]

Yeah, I forgot to mention, I did evaluate these ideas using CENTS framework (Grade My Business Idea: Business Ideas and Opportunities Rated Fast comes in handy) and they all come up pretty close. Algo strategies idea scores best, but it's like hunting for a holy grail.

I just used GMBI for the first time. Spot on. Really wish I'd known about CENTS back in the day.

Did any of your ideas score above C+ or B-?

I wouldn't put serious time into anything below A- / B+ score. Better to figure out how to change the grade first.

The challenge is that creating a profitable strategy is extremely difficult, bordering on nearly impossible, even for experienced quants.

Yet convincing people that it *might* work isn't hard at all. The whole world loves a system that might beat the house.

All you really need is an algo trader that works SOME of the time and run it against a bunch of portfolios to find winners.

 

[msd23]

I just used GMBI for the first time. Spot on. Really wish I'd known about CENTS back in the day.

Did any of your ideas score above C+ or B-?

I wouldn't put serious time into anything below A- / B+ score. Better to figure out how to change the grade first.


Yet convincing people that it *might* work isn't hard at all. The whole world loves a system that might beat the house.

All you really need is an algo trader that works SOME of the time and run it against a bunch of portfolios to find winners.

They got a B- or B. I graded them several times with some time in between to check for any biases I might have.

Anyway, I've decided to go with trading strategies and am researching them now. Surprisingly for me, just as Kevin thought, some very basic strategies are performing really well on certain assets.

Also, it's so refreshing to feel all this energy and drive once the decision has been made. I just hope it lasts.

 

[Two Dog]

Also, it's so refreshing to feel all this energy and drive once the decision has been made. I just hope it lasts.

Agreed! Just keep making decisions and it will last.

BTW, I'm revising my GMBI worthwhile score to B- or higher after grading a couple of other ideas. The upside from those kinds of ideas is plenty for my world. Probably something like $10M - $50M+ over time. Actually, the one sort of confusing thing about the summary is "Lifetime Potential Value".

I wish it included an expected number of years for whatever revenues are being projected.

 

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