
Amazon engineer will let strangers manage his $50,000 stock portfolio 'forever' - prostoalex
http://www.cnbc.com/2017/07/06/amazon-engineer-will-let-strangers-manage-his-portfolio-forever.html
======
dsacco
One of my favorite things about this story is the way it discretely slides an
association between "Amazon engineer" and "has $50k to let go of 'forever' on
a social experiment" across the table to the audience.

That's the real message that's going to be received by a large amount of the
population reading this story as it makes the rounds on outlets like CNBC.

~~~
merkaloid
He's probably not just any engineer because if you actually check the stream
it looks like it is viral marketing for "robinhood.com"

~~~
willtheperson
This is probably it. I personally signed up for Robinhood based on this
project. I'm already interested in stock trading though so it wasn't that big
of a commitment from me but they do have a nice App and signup process
compared to other financial trading outfits I've used.

~~~
MichaelGG
Yeah, Robinhood is mentioned quite a bit on his site, including a sign up
referral link. Seems like their referral program gives you $10 for each
signup.

Also he says if it hits $25K, then the game is over. So it's only $25K at real
risk, not $50K. (True, the stocks could fall further before he liquidates.)

~~~
hbosch
Also: anyone have an idea as to what regulations he is citing when he says if
it drops below 50% he has to close the account? Is that a Robinhood thing, or
an equities trading thing? As far as I know, there is no regulation limiting
how much a person can lose on the market...

Makes me wonder if perhaps his account balance is $25k personal, and $25k
matched by Robinhood for the stunt.

~~~
stockstream
The $50k is all mine. I was not given anything from Robinhood except for
approximately $500 worth of free shares for referrals.

You can learn more of the $25k rule here:
[https://support.robinhood.com/hc/en-
us/articles/217072366-Pa...](https://support.robinhood.com/hc/en-
us/articles/217072366-Pattern-Day-Trading)

~~~
samstave
If I were Robinhoood, I'd try to be the facebook of financial startups- give
every high school student a starting portfolio of fake stocks to manage
through high school so they learn how to invest and manage money, then have
avenues to have different "tabs" in their portfolio for real stocks they have
gifted by family, and another for real ones they buy...

They can play with purchase what ifs in the stock sandbox, and plan and grow
in the real tabs... among many many other things...

~~~
samsonradu
But is investing in stocks something you would want high school graduates to
pick up?

I always thought of stock-picking as something that the average Joe should be
careful with. Trading on less information than insiders and slowly being eaten
by fees and taxes. It's an under EV game.

Besides that there's the wisdom of crowds that will eventually follow the
trends and invest irrationally (pump and dump). That's how bubbles are
created.

~~~
samstave
When I was in highschool, I was attempting to corner the market on commodities
- specifically wheat!

Every day I would log in and manage my account - I was a commodities broker
and I managed to build a pretty powerful little empire with my savvy
transactions.

While not as powerful when it came to ore... my wheat holdings were no
laughing matter... that was until the day I smoked pot, dialed in and
accidentally sold all my wheat holdings as opposed to buying up all the other
supply - thus eliminating my monopoly on the galactic wheat trade...

Man, Trade Wars was a blast in the early nineties.

~~~
samsonradu
That's an interesting story and I'm sure you learned a lot through the
experience. I'm also sure there are plenty others like you, to whom trading
was educative.

But on the other hand I'm sure there are a whole lot of young people on the
other side of things. Those who start learning about stock-trading and soon
see it as a way to make money fast by taking huge risks. They get spammed by
500$ signup bonuses to various stock-trading platforms, they're presented with
100x leveraged trading options and such. I don't see much benefit in that.

What I think is young people should be taught how the market works with a huge
grain of salt. Definitely not by letting them go wild with play-money since we
all know what will follow up.

------
stockstream
Hey everyone! Glad to see you're all enjoying the project. I'd be glad to
answer any questions you have. Let me know!

~~~
kogepathic
Why did you decide to do it with $50,000 and Robinhood instead of just
creating a bot to trade stocks on an Investopedia stock simulator account? [0]

I mean, I understand that $50k might not be a lot for you, but if the aim is
to see what the majority of random people on the internet feel like buying,
while measuring the return of these decisions, this could be accomplished
without putting up any actual money.

[0]
[http://www.investopedia.com/simulator/](http://www.investopedia.com/simulator/)

~~~
fullshark
The actual money aspect is why this blew up. No one would care if it was fake
money.

~~~
kogepathic
_> The actual money aspect is why this blew up. No one would care if it was
fake money._

Two things:

1\. This is assuming it was done for the press coverage, and not just as a
hobby project

2\. If I were to do this, I don't think I'd advertise it was fake money.
What's the difference anyway? It's not as if people on the internet benefit at
all from the investment return. I always assumed this was more of a "Twitch
plays Pokemon" thing than anything more serious.

~~~
fullshark
I wasn't assuming it was about press coverage necessarily (though maybe it
was), but that in order to be interesting it needs a critical mass of people
participating. If it wasn't real money then that wouldn't happen.

------
sillysaurus3
For realtime stats:
[http://stockstream.live/portfolio.html](http://stockstream.live/portfolio.html)

Looks like they're down $577.18 so far. Jebaited

~~~
ChuckMcM
I wonder how they got one share of ZNGA for $0

~~~
stockstream
Some shares were gifted for free by Robinhood for referrals.

~~~
ChuckMcM
Thanks for that tidbit.

What was second place, _two_ shares of Zynga? :-)

~~~
jsmthrowaway
One share of Snap, probably.

------
ChuckMcM
Pretty much defines a "blind trust" :-).

I find the experiment pretty interesting, how many people will try to make him
go to zero? How many will want to make the value higher? If you were
leveraging a pump and dump house how does that work? And home much can you
trade at once? (all would seem to be a silly amount, but it has to be enough
to make reasonable trades)

And how do you know it is _actually_ real money? We used to do office stock
pools where folks would start the month with "$100,000" and got two trades a
day, one at noon and one when the market closed (easy to do on the west coast)
at the end of the month the one with the most "money" would "win". It was fun
and taught me a lot about market volatility (and that I would suck as a day
trader :-)) but there was no actual requirement for money to actually trade
hands. And even at $50,000 you're not buying or selling enough to move most
stocks.

~~~
lr4444lr
The question that really bakes my noodle is, what if the people who try to
make him go to zero collectively make his value higher? ;-)

~~~
kaffeemitsahne
I've come across multiple papers investigating stock trading strategies, where
they mentioned little or no effect for the actual strategy, but a significant
positive effect for the opposite strategy.

------
havella
Maybe this is the beginning of "Twitch Trading". If ppl like seeing other ppl
playing video games, trading stocks/futures could find an audience. The
question is what would be the incentive for a competent trader/algo to let ppl
see it's trades.

~~~
gricardo99
what would be interesting though, but much more of a niche, would be if some
successful quant traders did an in-depth review of some "alpha" or strategy
they ran some time ago, which is no longer profitable. They could discuss
their tools, analysis , trading metrics, performance, and some discussion of
why the strategy stopped working.

It would give a good window into the work-flow and skills required to do this
successfully. Even if it's retrospective, going back a few years.

~~~
rfrank
A friend of mine kinda does this, a lot of the content on his site is
comparable to what you're describing.

[http://www.verticalsolutions.com/papers.html](http://www.verticalsolutions.com/papers.html)

------
jimmcslim
Would an infinite number of monkeys making an infinite number of trades find
proof of Fama's Efficient Market Hypothesis?

~~~
tpeo
I don't see why they'd bother.

------
arikr
> Its 0.4 percent return slightly outperformed the 0.2 percent rise in the S&P
> 500 since its launch on May 30.

Amusing excerpt. Highly relevant, of course.

------
hammock
Screaming Eagles are an arena football team that allows the fans to call the
plays.

[https://www.nytimes.com/2017/02/17/sports/football/indoor-
fo...](https://www.nytimes.com/2017/02/17/sports/football/indoor-football-
league-screaming-eagles.html)

------
arwhatever
Is he going to support the software integration piece of this, forever?

~~~
stockstream
Yes

------
morley
I'm really curious what his streaming software looks like. I've always been
interested in how stream video gets composited and what tools are available,
but I'm too lazy to look into it.

~~~
r1ch
OBS Studio is the most popular software right now for Twitch live streams.
It's open source and under active development.
[https://obsproject.com/](https://obsproject.com/)

(Disclaimer: I'm one of the developers)

~~~
dastbe
are you the waffleimages r1ch?

~~~
r1ch
Of all the things, that's what you recognize me from? :)

------
passivepinetree
Twitch Plays Pokémon and other such games tended to be highly disorganized and
take forever to accomplish basic tasks.

I wonder if that'll be the case here, and if so, whether that means better or
worse investing.

~~~
MichaelGG
Pretty easy: "The game is divided into voting rounds, each lasting 5 minutes.
Every 5 minutes the top buy or sell command will be executed and one share
will be bought or sold. You may only vote once per round."

[https://www.twitch.tv/stockstream](https://www.twitch.tv/stockstream)

Buying or selling a share is basically atomic, so there's no coordination
needed apart from the overall portfolio. Looking at the portfolio,
[http://stockstream.live/portfolio.html](http://stockstream.live/portfolio.html)
, most positions are just a few shares.

------
WalterBright
Brokerage fees on each transaction may quickly eat up his principle.

~~~
pgodzin
Robinhood doesn't have transaction fees

~~~
WalterBright
I see, you're right. But there's the spread between the bid and ask prices,
which will grind away at your profits if you rapidly trade.

------
kuldeep_kap
Does anyone know how is this implemented? Is there some stock trading API?

He also talks about some regulation at the end. Does the entity needs to be
setup legally in a certain way?

~~~
oh_sigh
Yes...presumably many companies offer it, but it may not get top billing
because it isn't exactly a widescale consumer product.

Here's the one I use, which has great rates:
[https://www.interactivebrokers.com/en/index.php?f=5041](https://www.interactivebrokers.com/en/index.php?f=5041)

~~~
kuldeep_kap
thanks!

------
CryoLogic
I wonder why the Amazon engineer part is relevant?

~~~
grahamperich
it's not, it just gets the writer more clicks on his/her headline

~~~
luvandp3ace
You need a hook. Especially when robinhood is trying to generate some viral
growth.

~~~
grahamperich
Oh, yeah I agree! I didn't mean to sound like I was knocking it. Good
journalists know they need an enticing title

------
Pica_soO
Buy in a fractal denial pattern area near the New Coastline.

Global Warming.

Rising Sea-levels.

Human stupidity.

Profit.

Your grandchildren will be grateful. Or spoiled brats.

~~~
rizwank
Fractal Denial? This is a new term to me... and the #1 link for Fractal Denial
on Google is your post :)

~~~
Pica_soO
Its basically patent- trolling with ground. You buy enough to stop any
construction process, dead in the water due to legal processes.

Now you can extort from any company going there, wanting to build something
the money for the little area you sell + the money it would cost to restart
construction elsewhere - 1$ + the legal fees saved by not going to court.

ProTip: You might want to share the wealth with local legislators later upon,
to avoid having zoning-laws changed.

------
gcb0
is forever in quotes because it implies "until 4chan gets here"?

------
petraeus
Its 50k of advertising for robinhood, which is peanuts

------
MetaMonk
Twitch plays NASDAQ

------
crimsonalucard
I bet he can beat 50% of all hedge fund managers.

------
pebo
I bet it'll just track the s&p 500

------
martin_hnuid
Does Robinhood offer an API?

