Inspiration Season

Moontower #228

May 12, 2024

Friends,

It’s graduation season.

I always share these 2 posts in May:

Wooderson’s Commencement Speech

You might recognize “Wooderson” as Matthew McConaughey’s first cinematic role in the film that gave moontower its name.

The speech is an all-time banger. The link includes my favorite takewaways but the speech should be watched on YouTube (link included in the post).
Keepsakes From Slatestar’s Fake Graduation Speech

This should be read annually.

This year I add a third item to the commencement pack. I mentioned it on Sunday. It’s The Essential Paul Graham, a re-factored collection of excerpts organized by a few themes I find important. If you are at a crossroads or at the start of your career or even just in HS/college (especially in college actually), read it. Graham has been prolific so it’s not exhaustive but that’s also the point. It’s highly digestible in a single sitting. If you want more, the breadcrumbs are all there.

Maker’s Schedule, Manager’s Schedule (5 min read)
Paul Graham

I didn’t include this PG essay in the essentials because it’s a bit narrower but it’s a quick read that will resonate.

Excerpt with my emphasis:

One reason programmers dislike meetings so much is that they're on a different type of schedule from other people. Meetings cost them more.
There are two types of schedule, which I'll call the manager's schedule and the maker's schedule. The manager's schedule is for bosses. It's embodied in the traditional appointment book, with each day cut into one hour intervals. You can block off several hours for a single task if you need to, but by default you change what you're doing every hour.
Most powerful people are on the manager's schedule. It's the schedule of command. But there's another way of using time that's common among people who make things, like programmers and writers. They generally prefer to use time in units of half a day at least. You can't write or program well in units of an hour. That's barely enough time to get started.
When you're operating on the maker's schedule, meetings are a disaster. A single meeting can blow a whole afternoon, by breaking it into two pieces each too small to do anything hard in…
For someone on the maker's schedule, having a meeting is like throwing an exception. It doesn't merely cause you to switch from one task to another; it changes the mode in which you work.
I find one meeting can sometimes affect a whole day. A meeting commonly blows at least half a day, by breaking up a morning or afternoon. But in addition there's sometimes a cascading effect. If I know the afternoon is going to be broken up, I'm slightly less likely to start something ambitious in the morning. I know this may sound oversensitive, but if you're a maker, think of your own case. Don't your spirits rise at the thought of having an entire day free to work, with no appointments at all? Well, that means your spirits are correspondingly depressed when you don't. And ambitious projects are by definition close to the limits of your capacity. A small decrease in morale is enough to kill them off.
Each type of schedule works fine by itself. Problems arise when they meet.

Interestingly, Graham recognizing the importance of both schedules, comes up with the same solution Cal Newport recommends: “office hours”. It’s also the same solution I basically came to — if you wanna chat, I send you a TidyCal where my time is preconfigured in an “office hours” way. I will put things in my calendar to nudge “stacking” so I can have uninterrupted half-day blocks to work.

2 final bits of inspiration for the ambitious:

Money Angle

Moontower.ai, besides being an analytics software, is also becoming a launchpad for anyone using or learning about options. To take full advantage of the free tools just sign up.

Thank you for signing up for Moontower. You are welcome to begin exploring a slate of free offerings including:

MoontowerGPT - a custom GPT with all published Moontower writing embedded (every night it updates based on updates to any of my web properties).

Moontower.ai blog - hundreds of posts organized by categories such as "Options and Volatility", "Risk & Edge", "How Markets Work".

Moontower Resources - an archive of tutorials, release notes, cases, and even a curated list of newsletters for investment analysis

If you are interested in using options, these progressions are specifically structured to help you adopt the Moontower lens:

Watch the Walk-Thru Video

Read the Primer - it's broken into short written essays, to make it digestible. The first 7 posts are the core philosophy. It reads quickly and is strongly recommended. The remaining posts comprise the Implementation Unit. They follow a logical sequence but can also be used as a reference to understand particular tools.

Check out the Moontower Mission Plan [coming soon!] - this document is a hybrid of worksheet/flowchart for various use-cases whether you are looking to put on a directional bet, hedge, or make a volatility play such as selling covered calls.

For the analytics and community features a pro subscription is required. As you may expect, a common question we get:

Do you think moontower.ai is worth the investment for someone who has limited option knowledge or time❓

This is a complete answer.

Money Angle For Masochists

Jane Street just released iPhone and Android apps for their training game Figgie.

Back in 2000, I joined the Assistant Trader program at SIG out of college. The deal was that you spend 6-18 months in rotation before they send you to headquarters for 10 weeks of intensive training. Competition to get accepted into the training was intense because it was only held 4x per year. You were given a raise from $37,500 to $50k when you got accepted to it and, if I remember correctly, another raise to $60k when you completed the course and got assigned your trading job.

[Acceptance to the class was conditional on signing an extremely strict 3-year non-compete. That non-compete had several provisions that went well-beyond 3 years and ended up being the reason I switched from oil options trading to nat gas when I left the firm.]

As an assistant trader, or “clerk”, you’d support one or more option or ETF traders during market hours then compete in classes and “mock” after work from about 4-6pm. (And for that first year out of college you’d spend several nights a week playing poker for another 2-5 hours. It was a good thing at the time. We were insufferable though. If you bugged the room you’d die of cringe to hear “I’m 60 delta to hang out this weekend”.)

Mock trading was usually a simulation of option market making in an open outcry setting. But sometimes we played games. Since I clerked for several people that became early partners at Jane Street I suspect this particular game was a precursor to Figgie.

Related reading:

A little post script

When I graduated from trading class in the summer of 2001, I was assigned to an option pit on the American Stock Exchange where the most active names were AIG, GLW, Q, and EK. My total coverage was about 30 names.

I was actually delayed by a month in getting my “badge” or license to trade — I was supposed to start the week after 9/11 happened.

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