My NEW Twitter Hedge Fund… ‘Yutz Capital’

I figured the whole thing out on Twitter and Facebook and have the perfect strategy.

I created the perfect market beating algorithm. No drawdowns. This [email protected]#!king fund just goes UP.

My fund measures how many people follow me on any given Wednesday with the names Jesus and Obama is their profile. If it is more than 3, the market goes up on the following Tuesday.

If you would like in, just send me your wiring instructions. My Nigerian partner will take care of the rest.

After 20 plus years in the money business, it continues to amaze me how people chase returns. People will do it in 2050 and 2090.

The financial world is dominated by marketing and scale. It makes sense. The SEC is in 1984, open and shut cases are not even prosecuted and there is no better scalable business in the world than managing other people’s money.

Warren Buffett knows this so he only invests in sure things. When he invests, the outcome is already decided. It was not always like this for him. He took risk once upon a time. Now he would be competing against imbeciles and machines and he is too smart for that.

While Warren guarantees his future, ‘accredited’ investors chase funds like Jon Paulson who is in the scale business and marketing gimmicks like ‘Derwent Capital’ which claims they can predict the market using Twitter.

Predictions do not matter. Managing risk matters. As I mentioned a few weeks ago, Markets can’t be Tamed, Just Managed.

I do believe there is signal in Stocktwits and Facebook and Google and Twitter profiles with ‘Christ’ in them. Go sign up for an Etrade account and blow your brains out with their toys and a Twitter account.

It has never been easier to get in the ‘game’, but it has never been less of a ‘game’ to those who want to make a profession out of it. The markets are in serious trouble because liquidity for stocks is on a path of doom.

Ask any 20 year old that is learning how to trade with social networks and any 20 year old that is an entrepreneur. They prefer to play games on their mobile phones and invest their money in other people, not stocks and bonds.

I hear it everyday and it pisses me off. It should not be like this at all. In 2011, with all the tools at our disposal, investing in public companies should not be considered just a game.


  1. TheAcsMan says:

    For me, short term tops are marked by increased AdSense revenue on my site, When the market is going up, people love clicking on those Scottrade ads. The best days are when stocks and precious metals are both climbing. The CPC does, as well. When I start seeing a crescendo in CTR and CPC, I know that we’re heading down sooner rather than later.

    I may have a counter to your Yutz Fund. I’m looking for someone to help me set up a Yesterday’s Technology Fund. This one will only go down, so I supose some kind of Hybrid, maybe Yesterday’s Yutz may be a good balance.

    • M. Edward (Ed) Borasky says:

      Yesterday’s Yutz? Hmmm … if I ever start a hedge fund I think I’ll call it Pyracantha Shares ;-)

      • TheAcsMan says:

        I’m humbled. I usually don’t have to look up the definitions of words.

        I either get it from context or totally ignore an unknown word as being superfluous to the context.

        But I had to look this one up, and you’re right. What better name for a “hedge” fund?

        Such a Yutz not to have known that.

          • TheAcsMan says:

            A few days ago I wrote a blog entry, Bouncy Bouncy Bally that compared the Kindle Fire/iPad argument to the technology argument of my days growing up in new york, related to which was the better stickball “ball” – “Spalding” or “Pensy Pinky”.

            Your use of “Yutz” and great URL name transports me back to a nice time. All we really had to worry about then was communist baiting , UFO’s and an unkind Yiddishism being hurled our way because the Spalding broke a window.

  2. M. Edward (Ed) Borasky says:

    The problem is that the tools aren’t at *our* disposal! As Robert Sinn put it, “the HFT algos are designed to trigger stops and cause trend line breaks in order to suck in human money”

    Forget “Occupy Wall Street”. Forget “The Buffett Rule”. Get President Obama, Tim Cook, Jeff Bezos, Larry Page and Steve Ballmer together in a room and get the money-suckers shut down!

  3. Leigh Drogen says:

    The idea that the market has ever been anything other than a game is a fallacy, nothing has changed, it’s all just numbers and symbols, there is no true value to any of it beyond what someone is willing to pay you today. The idea that investing and speculation are two different things is false, the market has and always will be speculation and speculation only. Buffett gets to play by different rules because of the size of his capital pool. We should all just accept it and learn to play the game the best we can.

    • His capital pool wasn’t always Olympic sized, there was a time that he was investing with a inflatable kiddie pool and it made him the man he is today.  Incredibly wealthy.  Buffett has a rare combination of long-term vision, the patience to allow that vision to manifest and the self-confidence to not waver from his decisions on the road to that manifestation.  Unfortunately the world was different in his heyday, companies focused on growing sustainable businesses and not just profitable quarters at any cost.

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