The Bookshop Guru: November 2012

Sunday, 25 November 2012

Dead of Night - A Poem

The Bookshop Guru

Below is a poem I wrote some time ago which often reflects our time.

Dead of Night

Cruel acts of night pass by,

Families scatter.

Never to unite their blood spilled to mix in muddy pools.

A whistle in the wind,

Terror rules.

Unnatural times, an asylum of some.

Who torture with revenge without guilt.

Then in a passing second another life is lost.

Not counted just a casualty of chaos.

Time to stop this madness.

Before we ask where next.

A boy with a bullet screams out a killer in the dead of night.

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In my book “It’s Never Too Late” read how dreams do come true, but be careful what you wish for. Understand the secret of greed and you will attain one of the secrets of prosperity. The book will also take you on a journey and explores love, money, luck, and much more.

Click Here

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P.S. Tomorrow Never Comes

Hey, Chuck. Did you bring any spending money? Viva la vida loca.

Conducting a Survey into Precognitive Choices

Which would you prefer half-price digital or paperback?

Never late, but sorry.

Read my book "It's Never Too Late" by Anthony Fox, published by Chipmunka Publishing

Sunday, 4 November 2012

Adding Alpha - Do Computers Have the Edge?

The Bookshop Guru

Making money trading in stocks, shares, commodities, and currencies for the investment banks and institutions in today’s cyberspace currently relies heavily on ‘algo-trading’. Algo-trading is a term used to describe the algorithmic software which is used to gain that alpha edge against an increasingly frenetic trading market where milliseconds can mean millions in buy and sell decisions in veiled trading markets.

There are a host of different strategies deployed in ‘algo-trading’ to achieve that elusive alpha edge. Some algorithms are designed to slice and dice trades into smaller multiple trades in the hope that another algo system doesn't spot the pattern and alert the opposition and lose the potentially profitable edge. Pattern spotting software of all shades and colors is deployed to gain the alpha edge and crunch huge amounts of data waiting for the triggers to buy or sell.

The inherent problem with algorithms whether their based on neural networks, genetic algorithms, knowledge discovery systems, or any other type of pattern recognition software is the paradox in automated pattern discovery systems in extracting random data sets and the association of interestingness as a measure of the usefulness of the data patterns revealed, because there is no prior knowledge of the likely interesting data associations to be found before automation. “If you do not expect it, you will not find the unexpected, for it is hard to find and difficult.” (Padmanabhan & Tuzhilin, 1999)

The essence of this is that it is easy, to spot a pattern, because it is already there – so designing algorithms to look for certain criteria and predicting a pattern would be more profitable. The use of artificial intelligence is still in its infancy relative to how much we really understand the capacity of the human brain. We only use about 10% of our brain capacity, and the rest is mostly conjecture and theories. The human brain has billions of neuron connections, yet even the most advanced neural networks only use a handful of connections and they are used in a wide range of applications such as stock market analysis and recognizing trends, cancer screening classification, etc.

It’s not about computer power like the SETI project where spare computer processing power cycles are combined from around the world, to number crunch and analyze segments of the night sky. The problem is that artificial intelligence is based essentially on learning, and adapting to the data sets, while at the same time, using classification to modify its process – but, it’s not forward-thinking, it doesn't need more computer processing power or memory, it lacks perception – the ability we humans call intuition.

See the Film...Click here

Some of the most successful sage investors (like - Warren Buffet) have built fortunes based largely on simple investment strategies, over the long term. Short-term fluctuations, and gambling on the outcome, is the global daily routine of investment institutions and banks, and how they make their money, but, the paradox is that when one is making money, the other is not. It remains to be seen if real transparency exists in these trades or is hidden within veiled accountancy practices. We have seen the outcome of greed, in cases like Enron and Barings Bank – when the light is switched on all is revealed. Don't get mistaken, computers and software systems are vital for a multitude of social and economic purposes, but they don’t have the alpha edge, in my opinion.

The human mind will always be more powerful than any computer because it has that hidden element of perception. An example of this would be George Soros who made a mint in the 1990s. Is anyone for polo?

Are you listening, what are you dreaming?