
Neural Net Side Project Makes $3500/mo Trading Stocks - sebyddd
https://www.indiehackers.com/businesses/stock-trading-bot-1?utm_source=hacker-news
======
svantana
I may be way to cynical for my own good, but there's no proof that this is
actually real, right? Besides a couple of pretty bizarre screenshots [1]. I'm
skeptical because a) these types of gains in public markets are pretty much
unheard of, and b) faking a story like this would be a fairly easy way of
getting lots of attention for your freelancer business (which this guy
advertises right at the top of the article).

[1] Running cat on a csv file would usually just print a list of numbers, yes?
Instead he gets ascii art with months on the vertical axis, making it seem
like time going back and forth, and some random commentary in the right
margin. I dunno but something about it screams "mockup". As does the
minimalist, ultra-stylish AWS window.

Edit: also, if it were me who got incredible returns from trading at high
speed on indian markets using only machine learning on historical data, I
would definitely keep quiet about it. Just sayin'...

~~~
sebyddd
Appreciate your point of view. First of all, there seems to be a lot of
skepticism around this project and I found that surprising. You're saying that
if you would get incredible returns from trading you would keep quiet. And
therefore you are contradicting yourself by accusing my lack of transparency.

As I was invited to share my story on Indie Hackers, my goal was to provide as
much insights into the project, without blowing up the advantage it gives me
over a very niche market (NSE). I have absolutely no intention to 'advertise
my freelancer business' or 'sell my tech', as someone mentioned. My goal was
strictly to send an encouragement message to people thinking of/building
something similar, by sharing as much as I can of my project. Faking stories
online would be the last thing on my agenda and I find it somehow amusing that
some people believe that.

PS: Having to cat a lot of text + csv files while developing this, it was much
easier to alias my cat function to use csvtool on csv files and it's regular
implementation on other files

PS2: The 'minimalist, ultra-stylish AWS window' is a quick app I cranked in a
few hours to see the status of my instances. Not sure what's suspicious here.
The window or the the fact that it's stylish?

~~~
frgtpsswrdlame
>Appreciate your point of view. First of all, there seems to be a lot of
skepticism around this project and I found that surprising.

Really? You made a crazy claim with no details at all.

Here's my assumptions on this thing:

1\. Your algorithmic strategy is only performed on a small selection of
stocks, that you have semi-randomly picked, aka not a part of your system.

2\. These stocks have had a crazy run.

3\. When the NSE had troubles in Nov. and Dec. your conservative stop losses
triggered and you stayed out of the market.

4\. Your decision on when to re-enter the market was a personal decision, not
a part of your system.

5\. You have given this thing more money to invest with than we are being led
to believe.

Which ones did I miss on?

I gotta be honest, it really does seem like a nice little way to plug you
business but I don't believe you're lying. I think you're overstating its
performance by leaving out details and were lucky to get that performance in
the first place.

------
alva
Reposting my comment on the first HN submission of this page

"The claims made in this interview are extremely suspect, it just not make
sense. Absolutely no relevant details are included. The developer claims he
was able to built an AI trading strategy that is profitable 95% of the time.
No technical details about the strategy or platform for trading is provided. A
few trading buzzwords thrown in a few places. The rest of the interview is
platitudes and inspirational hacker talk

I think IndieHackers needs to investigate the claims and be provided proof,
otherwise this appears to be a fake project for the developer's own publicity.
If IndieHackers are fine with that, I will stop visiting as I cannot trust
that the content is not just shallow, exaggerated claims to raise peoples
profiles."

After expressing my concerns directly to IndieHackers, the interview was
changed in multiple places to flesh out a number of the spurious claims which
I had criticised.

Without further details or some proof from the developer, this piece stinks.
Taking into account the rest of the interview which contains stereotypical
inspirational hacker talk, the whole thing feels like a badly done promotional
bit for SV style status.

If I am wrong, I will apologise and the developer is going to be a
multimillionaire very, very quickly. Until there is more details, I am going
to be totally sceptical of IndieHacker interviews going forward. Which is a
shame as I think IndieHackers is a great site. How can I trust that the other
submissions are not baseless, PR pieces?

~~~
ucaetano
Do you have a link to the original version? It looks fake enough as it is, I
wonder how much bad it could be.

But hey, maybe this guy really cracked the market, and a Nobel prize and
billions of USDs are on the way...

~~~
csallen
The changes were to add details explaining the 95% "success rate", the sources
of data, and the exchange that he was using.

I think you guys are both creating a false dichotomy between "genius who
cracked the market" and "liar who is fabricating data", when there is plenty
of room in between, e.g. "someone who made a few lucky trades in a bull market
over a short period of time," which would describe probably the vast majority
of "winners" in the stock market.

It's the equivalent of asserting that everyone who plays a slot machine must
break even, when in reality some people win and some people lose.

~~~
alva
Hey. As we spoke about this earlier today, could you please post the original
before the edits post our conversation?

edit: I rang the bloody alarm bells about this submission with you. I hope I
am wrong, but it looks like you have been had.

~~~
sebyddd
alva, I found your skepticism very biased. Following your requests, we decided
it would help if we address your questions in the interview. Therefore the
only edits, where just addition around the 95% claim which seemed to be
misunderstood.

Your main claim was that the bot cannot achieve 95% trade success trade
constantly, which I undoubtedly agreed to and added more details on this
claim.

The edit also provided more details about the platforms that I used along the
way, as this detail was overlooked in the initial version of the interview.

I find your claims unfounded and harassing.

~~~
alva
Post your historic and current positions, opened and closed.

I am not the only one who is extremely sceptical about your claims.

------
kyleschiller
Publication bias is a gigantic problem for amateur FinTech.

How many hundreds of engineers tried the same thing and won't get an article
on the front page of HN because no one wants to read about mediocre
performance? I don't want to sound too skeptical, quantitative HFT is
absolutely the future, but if enough people try something that's effectively
gambling, some of them are bound to succeed, and those people will get
dramatically disproportionate exposure.

EDIT: I do still like this post and the project, the infrastructure is great
and it offers insight into something I'm sure many people are curious about.

~~~
digler999
> How many hundreds of engineers tried the same thing

And you bet your ass if I tried and succeeded I'm not going to come here and
brag about it, risking whatever ephemeral edge I had. If I did this, I would
do it for _dollars_ , not karma points.

~~~
ng12
I have a feeling the author is really much more interested in selling his tech
than he lets on in the article. I can't imagine any other reason for going
after the press.

~~~
sebyddd
Really not. If that was my intention, I would went directly to the source. I
was invited to share my story with the sole purpose of inspiring others. I
have no plans of selling it whatsoever.

------
minimaxir
Votes on this submission may be manipulated with an attempt to bypass the
voting ring detector via linking to /newest:
[http://i.imgur.com/08pAFOw.jpg](http://i.imgur.com/08pAFOw.jpg)

And another one by Indiehackers founder csallen after it already hit the front
page: [http://i.imgur.com/rxWtsWJ.jpg](http://i.imgur.com/rxWtsWJ.jpg)

~~~
csallen
As far as I'm aware, it's perfectly fine to link to discussion on HN, but not
okay to explicitly ask for upvotes:
[https://news.ycombinator.com/newsfaq.html](https://news.ycombinator.com/newsfaq.html)

~~~
minimaxir
Then why did you include a picture of the submission in that tweet?

Also you ignored the first picture which clearly shows your account.

~~~
csallen
Correct, because the first picture is not explicitly asking upvotes either,
but asking for comments. And I include pictures (or at least emojis) in as
many tweets as I can.

------
ucaetano
Sorry, but the little content available on the page, the Amazon ads and the
very short run time makes my BS detector sound like an air-raid alarm.

Do you have anything beyond "I'm making $3.5k using methods I won't disclose
on an initial investment that I won't disclose"? What's your return on your
investment? Sharpe Ratio? If you apply your investment criteria in historical
data, do you beat the market?

How different is it from the guy who invested his tuition money on Tesla?

~~~
perteraul
If you had created something that works for you, would you sell out all the
details by spreading it on a public blog?

~~~
ucaetano
None of the details I asked would give his strategy, would only prove his
success.

Hedge funds, for example, are largely black boxes, but the publish their
returns.

------
canistr
Isn't it more customary in the financial world to put out your Sharpe Ratio or
ROI as a percentage as opposed to your monthly profit? As others have said,
the profit doesn't mean anything if your principal amount is high.

------
raharley0
Do you think testing for 4 months proves your bot is better than the hundreds
of serious players that spend millions on the smartest talent and the best
tech tying to eek out an edge?

How are you determining true alpha? We're in a bull market. Don't mean to
sound harsh but this could be blind luck.

~~~
sebyddd
Absolutely not. As I mentioned in the interview, the progress so far is not by
any means a reliable metric and there are many factors that affected it. 4
months is not nearly enough to prove that and so far the bot works well on a
very specific niche market. While there may be infinite other better
approaches, this is yet another working one, which doesn't necessarily yield
the best possible result. I understand your point of view and I completely
agree with it.

~~~
alva
How many trades have you executed?

------
hmate9
I do not wish to be negative, I just think it is very hard to really judge
this system without knowing the technical details behind it. Since we are
currently in a bull market it could just be a fluke.

I did not read anything about backtesting. Have you done that? If so, I take
it back :)

~~~
brianwawok
Backtesting does not mean much. It's easy to make an algo do well yesterday.
Very hard to make it do well tomorrow.

~~~
hmate9
I completely disagree. Backtesting matters, especially in HFT. What would you
rather have: an algorithm that has performed well on 5 years worth of
historical data or one that has performed well in the past 2 weeks.

~~~
sgt101
Neither; these are techniques applied on observed data in an obviously dynamic
open domain. The data is uncontrolled - so we have no idea if it is
representative of the current state of the domain theory - does it cover the
distributions properly; we don't know. We know the domain is dynamic in that
the world economy moves like around alot and we can't predict these movements,
in the sense that most actors did not call the last substantial negative
market movement. The domain is open in that new features can appear that drive
the value of the variable of interest; for example the availability of
property in China, new battery technology, a patent on nuclear fusion.

We do not have techniques that account properly for any of these things.

You may as well draw lines on charts and sell that advice, you'd probably get
as good a hearing in any Investment Bank in the world !

oh....

wait...

------
morgante
Can I do an Indie Hackers interview about how I went to Vegas a few times and
made $10k? I even have some Python scripts modeling my "strategies!"

This is almost certainly a fluke, if it's true at all. There aren't any
valuable lessons here and such a story merits a high degree of skepticism.
Algorithms which can successfully return 95% profits consistently are not
wasted on freelance developers.

I usually love Indie Hackers, but including this story really devalues the
brand.

~~~
csallen
I find these criticisms quite unfair, especially given that he admits in the
article that (a) he is new to trading, (b) his results cover a short period of
time in a bull market and could easily be 100% luck at this point, and (c)
he's had to manually step in to avoid ruin. You're excoriating Sebastian for
not hedging claims that he has repeatedly hedged.

I also disagree that there aren't any valuable or inspiring lessons for indie
hackers here. In fact, I enumerated some of them as asides in the interview
itself, none of which would apply to your hypothetical trip to Vegas.

You and others are hyper-focused on the irrelevant question of whether or not
Sebastian's attempt to build an unparalleled money-making machine has
succeeded (answer: obviously not), and ignoring the actual point of the
interview. It's the equivalent of the guy who read the SubmitHub interview a
few months back, ignored all the lessons within, and instead attempted to
create an exact clone of the SubmitHub product.

~~~
morgante
What are your standards for including interviews on Indie Hackers though?
Honestly, my criticisms are less of Sebastian than of you. He admits that his
strategy is unlikely to be profitable in the long run, but what exactly is the
merit of including stories about an amateur trader on a site about technical
side projects?

I, and likely many others in this thread, have tried our hand at trading. I've
had months where I generated amazing profits. I have "algorithms." Yet I
definitely don't pretend any of this stuff is special or noteworthy—why would
Sebastian's be?

A huge part of what's cool about Indie Hackers is that people are generally
transparent and you can see their approach to roughly similar problems. There
are plenty of sites (hundreds of them) where you can find people bragging
about their trading strategies and bots. Why does Indie Hackers have to expand
into them?

This is nothing like the SubmitHub interview. That had lots of great lessons
in customer development, building a brand over the years, etc. Realistically
the only lesson from this story is "get lucky."

> In fact, I enumerated some of them as asides in the interview itself, none
> of which would apply to your hypothetical trip to Vegas.

Why not? I'm sure I could come up with some trite lessons about how poker
playing is applicable to business and startups. Heck, there's a whole cottage
industry in doing so.

That doesn't mean I think a story about my poker playing would make a good
Indie Hackers interview.

> money-making machine has succeeded (answer: obviously not), and ignoring the
> actual point of the interview

What, exactly is the point of the interview then? You could just as well cover
random sites that have launched with 0 profit or revenue. Heck, if you're in
that business, I've got a ton of side projects I'd love to share.

I'm trying not to be _too_ critical here, as I genuinely like Indie Hackers.
But you need to have some standards for what gets included. Everyone who
manages to make money doing something shouldn't count.

~~~
csallen
I'm also trying not to be too defensive, but I strongly disagree with your
interpretation of this interview. Most of the IH audience will read this, care
very little about the "secrets" behind the trading strategy, and instead focus
on what you call "trite lessons".

In this particular case, the amount of time and effort an 18 year old put into
researching and educating himself about a difficult field is quite inspiring.
As is his dedication to doing some non-trivial programming work and actually
launching. That might not be inspiring to you or to professional traders on
HN, but I can assure you that most IH readers will not care if/when his
trading bot ultimately fails.

 _> What, exactly is the point of the interview then? You could just as well
cover random sites that have launched with 0 profit or revenue. Heck, if
you're in that business, I've got a ton of side projects I'd love to share._

I've featured lots of very small projects. My minimum cutoff nowadays is
$100/mo, but in the past I've done interviews where the revenue was $0 or not
shared. Although it's fun celebrating big revenue wins, that's not the point
of the site. (If you don't believe me, I can point to numerous places where
people have actually _asked_ me to feature $0 failure stories on the site.)
The point is motivation, inspiration, and education for getting around the
most common obstacles that stand in the way of creating an online business.

~~~
morgante
> Most of the IH audience will read this, care very little about the "secrets"
> behind the trading strategy, and instead focus on what you call "trite
> lessons".

I'd like to think I'm part of the core IH audience. I come for interesting
stories of people building software from scratch and generating revenue from
it.

Someone who got lucky gambling their money for a few months is just not an
interesting story. It's way outside the mold of what you usually publish.

> My minimum cutoff nowadays is $100/mo, but in the past I've done interviews
> where the revenue was $0 or not shared. Although it's fun celebrating big
> revenue wins, that's not the point of the site.

It's good that you have a cutoff, but I think the issue is that this project
doesn't necessarily meet that. With your typical interviews, you know they're
making revenue from actual customers and that revenue is a meaningful metric.
He happens to have generated profit so far, but I also happen to have
generated profit on my gambling trip: it's not a meaningful metric, and in
fact, might as well be 0.

He could easily have all his revenue wiped out next month (and, in fact,
almost did). I'm really not sure what we have to learn from someone who has
successfully gambled for a few months.

~~~
csallen
Yes, ultimately the stock market is gambling, and thus the durability of his
product is quite low, but this is an arbitrary distinction from the rest of
the interviews on the site. I could point out unique distinctions for a dozen
other interviews on the site, e.g. the popup t-shirt company whose product was
temporary, the company making $0, the company doing entirely consulting
revenue, the pure hardware company, the paperback book author, etc.

What I keep pointing out are the undeniably valuable lessons that can still be
learned from what Sebastian did, as well as why a typical indie hacker might
find them inspiring and educational, and why they wouldn't apply to your
gambling analogy.

I'm not sure why you're ignoring these parts of my responses. Maybe it's
because you've already launched many non-trivial side projects, so you aren't
intimidated by that particular hurdle, thus you don't find it inspiring, and
as a result you feel compelled to focus entirely on the efficacy of his
product. Which is fine! But you are not everyone.

~~~
morgante
I guess I'm having a hard time seeing what exactly is so inspiring about what
Sebastian did, and why it's any different from my gambling "product." He's
very far from being the first developer to play stocks. What sets him apart?
It's not like he has customers, a marketable product, or anything more than
some (unverified) gains.

For my gambling, I too read books. I too wrote scripts and models to assess
things. I too have practiced.

At the end of the day, I don't delude myself into thinking those lessons are
applicable to my actual business.

~~~
csallen
Doing research, writing code, testing your product, and ultimately launching
it _are_ lessons that are applicable to actual business. Of course, they can
be misapplied to what essentially amounts to gambling, but so can any other
valuable skill. (e.g. If Sebastian put on his selling hat, started taking on
investors, and charging them a fee.)

The fact remains that many people never develop these skills, never get over
these hurdles, and oftentimes don't even realize that these hurdles exist.
They find it motivational to read about people who did. Especially a teenager
like Sebastian.

And ofc you're right: Sebastian is no different than others who came before.
But that's never been a criteria for being on Indie Hackers. I find it
somewhat telling that the people who are up-in-arms about this interview
consist almost exclusively of those working in finance or who've experimented
with algorithmic trading.

------
RomanPushkin
Sounds like a fake story: not too much facts, no neural net details, no links
to public profile where all the trading happens.

I was trading stocks, it's really easy to fake even videos. You don't even
need to fake it - just record everything and publish only successful deals.

If this story is true, it should be confirmed. Otherwise, the article can't be
considered as serious.

------
sebyddd
Hey! The maker here. Would be happy to answer your questions on my little side
project.

~~~
pigs
Are you willing to say how much money was at risk?

~~~
sebyddd
I'd rather not disclose the exact capital for personal reasons, but every
month has been profitable so far.

------
meow_mix
"Proprietary" technical details? He doesn't even cite the kind of network he's
using. This is an ad for him as a freelancer (I doubt the ad revenue hurts him
either).

------
almoehi
Can you say something about the software stack you used to build this? Are you
using any of the existing libs like zipline or completely from scratch !

~~~
sebyddd
I do rely on Zipline heavily + other deep learning libraries. I see no point
in reinventing the wheel. The stack is mainly Python and C++.

------
dollar
I wonder how many engineers have replicated the payoff of a dynamically hedged
short option without understanding that was what was happening.

~~~
csallen
You should explain for those of us who know little about finance but are
curious!

~~~
dollar
There are volumes written on this subject, though Taleb's "Dynamic Hedging" is
as good an introduction as any. The short explanation is that, in theory, the
payoff of any vanilla option can be replicated by trading the underlying
asset. For a while, quite a long while even, this kind of trading can look
profitable. There are many variations on this, such as trade frequency and
holding interval, but in the very end you realize you are being compensated
for an asymmetric risk. That is the risk of sudden changes of price while you
happen to have a position open, among many other risks. I would say that 99%
of the "newly discovered" profitable systems I have seen over the last 20
years were unwittingly replicating a short vanilla or exotic option without
understanding the risk.

------
alva
What regulatory issues do you face trading with the Indian Stock Exchange when
based in the US?

Also you mention you had some concern that some of the stocks may crash. Have
you worked in finance in the past to be familiar with the securities offered
by the NSE, BSE and MCX?

~~~
sebyddd
No regulatory issues whatsover. Zerodha, the company behind Kite is SEBI
registered, therefore standard regulations apply for NSE and the others.

Have not worked directly in finance, but I always had an interest in it.
However I accumulated most of my experience in the past year. My recent
concerns concerns were based on previously observed patterns and analytical
observation.

------
sputknick
How much of motivation would you say is profit versus the challenge of the
game?

~~~
sebyddd
Great question! To be honest, I had this idea in mind for a long time and I
thought a lot about it before I actually built it. Therefore there is
certainly motivation coming from the challenge of creating this and in some
ways I think the profit and challenge factors are somehow correlated.

------
billconan
What api is available to get realtime stock data?

And what api can be used for trading?

Are they expensive?

~~~
ddlutz
I'm fairly certain this is in the article: For trading I recommend Kite,
mainly for their stable Connect APIs and the low bandwidth. Their limitation
is 3 requests per second, and this was more than enough for my new strategy.
Getting solid historical financial data isn't cheap, and with so many people
hitting the providers to scrape and download data, I don't blame them for
limiting the offered information. Intrinio is a good provider for real-time
stock quotes at very inexpensive prices. However, getting access to more in-
depth data would always yield better results.

------
raincom
Does your bot day trade or swing/pattern trade?

------
omarforgotpwd
Sure, easy to make $3500 / month when the market is on a crazy bull run. Let's
see how it does when the market crashes!

~~~
sebyddd
I am pretty sure that when that happens, the majority of stock players lose,
not only my little side project.

~~~
omarforgotpwd
Exactly.

------
vorotato
If it has overfitting problems it'll lose money even faster!

------
brilliantcode
Let me tell you about the time I caught the "finance bug" after watching Wall
Street film in 2007.

I had a near 99% accurate scalping system. I could not believe it. Every trade
I was making was profitable. How could this be?

The system worked without a stop loss. Meaning 1% of the time the prices
turned, it wiped out all the profits (limited reward) accumulated.

I published all of these details on my university homepage which has since
been deleted as they won't let alumni's keep one. But I was very careful that
while 99% system accuracy is achievable, it's the downside risk that makes the
system _pretty fucking useless_.

Of course you can put a stop loss but the system ran on "limited rewards
unlimited risk". There's just no holy grail out there. Even if you read Hull's
options book, no matter how complex your option strategy gets, you always have
to be right at the end of the day. It's pure speculation and we all know how
casino's work.

So knowing this, if it sounds too good to be true, there's a very strong
reason for it. Retail trading is a _zero sum game_. Even more suspicious when
the downsides are conveniently left to "if I gave it away system won't work".
I was fully transparent about the downsides when I published my trading
system.

The last thing I wanted was to people without the financial literacy to
naively believe that a holy grail trading system existed. They don't exist.
History is filled with funds that blew up because they believed alpha
generation would be a constant thing.

Even quant trades I question their success. In the long run, all trades are
speculative and carry risks (except arbitrages which are automated to
oblivion). No matter how sophisticated you get the risks are always unknown.

------
danjoc
Can you speak to how much up front capital is invested to produce $3500/mo? If
you put in $1000 initial capital, that is super impressive. If you put in $50K
up front, then still nice, but more modest.

~~~
sebyddd
Can't disclose the exact capital, but the initial investment was less than the
monthly profit.

~~~
machbio
not to criticize you, but this seems to have no logic - "My bot holds a single
position from seconds to minutes (sometimes even hours), which makes it more
of an automated trader than a high frequency trader" \- so your initial
investment was less than 25K$,meaning you would be tagged has Pattern Daily
Trader with account freeze for 90 days - how does your Algorithm even work
with that kind of investment ?

Definitely feeling like this is faux..

Edit: Some pointed it is an Indian Marketplace - but the article mentions that
Initrinio provided real-time data but Initrinio only provide IEX
([https://intrinio.com/marketplace/data/prices/realtime](https://intrinio.com/marketplace/data/prices/realtime))

~~~
samfisher83
If he invested less than the monthly profit he it means he making more than
100%. That is pretty insane.

~~~
brianwawok
You can make more than 100% going to the slot machine at the casino.

The difference between gambling and trading is not that big. Trading has more
ways where you can get an edge over the house, but it is not that different
from poker or slot machines.

~~~
samfisher83
If you make a million spins of $1 each you will end with $800000 or whatever
the state law is regarding payout. In general an index fund will go up since
most economic policies are geared toward inflation.

~~~
brianwawok
HFT is not an index funds. No relation.

~~~
samfisher83
You were talking about stock market vs slots and that is what I am talking
about.

~~~
brianwawok
You cannot tell me what I was talking about because you aren't me :)

Trading is HFT. For anyone else, you should buy an index fund and never touch
it.

Day trading is a really bad HFT and bad gambling.

------
zump
Almost no details about the "neural net". This script kiddie has no idea.

