"What was your first concert?"
Moontower #237
Friends,
Fresh haircuts.
New desk in the house.
Yep, school starts this week.
I now have a 3rd grader and a middle schooler. A fresh chapter around here. The elementary years are sweet and innocent so the air is bittersweet as we look forward ahead.
The timing isn’t ideal, but on the night of the first day of school we are taking the boys to their first concert — The Foo Fighters. We have lawn seats at the Concord Pavilion. A first concert is one of those reminders that time is linear but our experience of it is anything but. For the rest of your life you will always relive that moment because “What was your first concert?” is the canned icebreaker at meetups and orientations.
My first concert was Rusted Root. It came late — my freshman year of college. I went to Battle of the Bands type stuff in HS but never to a concert that cost real money. Up until then I had been to very few live events. I had an uncle take me to WWF wrestling on a Monday night in 7th grade. We walked in a bit late but I can still remember the first match — the Rockers, Shawn Michaels and Marty Jeannetty (I think that was his name - I refuse to look it up the instead of trying from memory), doing their high-flying acrobatics against a couple of heels.
[I also got to see Randy Savage that night. Randy is a top 5 celebrity in my standings. An unparalleled performer both in the ring and in his interviews. But just as outstanding were his less-staged interviews when he’d go on The Arsenio Hall Show. Even within his commitment to the bit, he winked wisdom and self-awareness to the audience. He was always my favorite wrestler. His match against Ricky Steamboat in Wrestlemania III is unrivaled. But I didn’t appreciate just how amazing he was until I saw his old clips through my adult eyes. What really sealed his GOAT status — how beloved he was by his peers and everyone who came into contact with him.
He was a generous soul who put everything he had into the craft of entertaining. He took that seriously without taking himself too seriously. That combo is the embodiment of inspiration for me. To sit in the tension that we are dust, that in 100 years it is unlikely that your name in reference to you will ever be vocalized aloud again, but that we should give the moments we get here their respect. We don’t know many we got and they don’t matter far faster than we might hope. Randy didn’t get enough moments but man, pound for pound…f’n legend.]
A different uncle, just as awesome, took me to a couple Jets games way up in the nosebleeds. Like 3 rows from the top of the Meadowlands. Cold wind, fistfights, and the most spirited “J-E-T-S” chant in the stadium. That was also middle school years. I can’t remember too many of the names. Al Toon was there. We saw them play the Rams who I actually remember better — Jim Everett, Flipper Anderson, Robert Delpino. The Rams had the Giants’ number so those names are memory-etched in vengeance font.
In the late 80s, I became a lifelong Giants fan after reading and re-reading a book that went behind the scenes of a week’s prep for a game against the Eagles in 1987 (after the Giants won the Super Bowl). Interestingly, I can’t find the book on the internet at all. Anyway, my love for the Giants was cemented when LT stripped Roger Craig during the 1990 NFC Championship en route to another Giants championship.
The first discretionary purchase I made when I graduated college — even before my inaugural cell phone — was season tickets to the NY Giants. That turned out to be the Thunder (Ron Dayne, frown) and Lightning (Tiki Barber) year where Kerry Collins led them to the Super Bowl where they were dismembered by the buzzsaw of the greatest defense of all time led by Ray Lewis and Ed Reed.
[A pause for self-therapy:
I lived in Park Slope my first year out of college. I’d get to Port Authority to take a bus to the games. After the games, I’d wait in long ass lines in the cold to get back to the city. It was an all-day affair to go see these Giants. Psychotic in hindsight. Another strong memory — instead of drinking and hanging with the other fans on the bus I’d whip out Natenburg. I studied options on all these bus rides. I can even remember thinking that one day I’d be able to just enjoy myself but I had a lot of work to do until that time would come. If I’m telling it straight, it was a mix of self-pity and determination which is kinda pathetic. I really wanted work to be easy which feels so immature to say now. I can remember how it felt so strongly which indicated just how high the stakes felt to me. When I think back, I wasn’t motivated to be great — I was just deathly afraid of failing. Life itself felt like pressure.
How much of this was of my own making versus what was incepted in me by my upbringing? I don’t know. It probably isn’t healthy. But it was useful I guess. A decade later I got to meet Justin Tuck at a charity dinner in SF. He and his wife were seated at the table next to us. I remember telling Yinh, I’m gonna go talk to him — we’re at this fancy thing where rich techies would nonchalantly raise their paddle with 7-figure pledges during the “power raise” part of the evening. For all Justin knows I could be a baller. We are equals in suits even though inside I was fanboying. I was a fan of his from his first days in the league and even had his jersey. I only had a jersey of one other player:
Randomly I also met Shockey. Kind of. I was walking in Manhattan and he pulled up alongside me, rolled down his tinted windows and with total disdain asked for directions as if he was disgusted with the city. He didn’t seem like a pleasant fellow. But it appears I can manifest meeting players by buying their jerseys.
Well not all of them (at least not yet). I have a signed Klay Thompson jersey from a silent auction — I never met him but Yinh and I were at the game where he dropped 37 in the 3rd which is insanely lucky since I’ve been to less than 10 NBA games. It was the best live moment I’ve ever seen…which gets us back to the main thread.
In adulthood, live events have been my favorite way to spend money. You could say I made up for lost time — date night this Friday will be my second concert of the week and maybe the 200th concert of my life — Khruangbin, my favorite band from the past 5 years, is coming to my happy place — The Greek in Berkeley.
In preparation for the kids’ first concert, we watched the outstanding roc doc Back and Forth and Linklater’s School of Rock. I hadn’t watched SoR in over 15 years. Yinh and I rediscovered just how f’n good Jack Black is in that movie. I’m also convinced that all it takes to ensure my entertainment is to have a name “Jack [insert color]”.
Meanwhile, Zak found Jack cover-your-eyes cringe which is a) a testament to how perfect Jack’s performance is and b) an unsettling reminder — Zak now cringes. That’s a relatively new emotion around here. Gonna be a fun one for his shameless dad to trigger. The kids already think their parents are weird between mom performing full-on Tina Turner concerts as she gets ready in the morning and me having new nicknames for them every third day.
For most of the parents out there, it’s still very much summer break. Watch SoR with the kids one night. It’s a lot of fun and if you play an instrument I dare you to not dust off the cobwebs and play after the credits finish rolling (and yea, I plugged in afterwards. I even fired up the Digitech Whammy and looper to get myself right.)
You must watch through the credits — I literally (I’m using this word with faithful adherence to its definition not the colloquial literally-the-opposite of its original definition use) got tears in my eyes. Pure joy.
Money Angle
Some numeracy stuff today.
On Wednesday I boosted SIG’s Todd Simkin interview. In one of his prior interviews he explains the 3 qualities that look for in recruits.
We’ve given a lot of thought and had many discussions about this. When considering an individual, I believe that a combination of three key skills is essential. These are strong quantitative and analytical skills, which are separate from strong interpersonal skills. They are not negatively correlated, but rather uncorrelated. We’re looking for people who excel in both of these areas.
Quantitative and analytical skills are important, as are interpersonal skills. The ability to communicate effectively with others, whether it’s brokers to develop order flow or peers in the trading world, is crucial. It’s important to be able to learn from and teach others, which is a key part of our culture.
The third dimension is gambling skills. Once you have information about what is fair value and can draw the order out of the market, it’s important to take appropriate risks. Can you identify what risk looks like? Are you taking up the right amount of risk?
The individual we’re looking for excels in all of these areas. We’ve found that being exceptionally good in one area does not compensate for lacking in the other two. We’ve encountered great gamblers with poor interpersonal skills who didn’t succeed with us in the long run. We’ve also met incredibly analytical people who excel at quantitative research but can’t make decisions when it comes to putting money at risk in the trading market. Their gambling skills are low, but their math skills are high. That doesn’t work. They end up not trading.
So, finding the right balance between these three skills is crucial for us.
The gambling skill thing makes sense because a great analyst is like a car with no power to the wheels if they can’t figure out how to bet and size risk. (Although the pod shop model pools and scales smart portfolio construction practices. I’m not sure to what extent that might reduce the need for gambling skills in the future. Then again, we could probably say that’s a narrow metaphor for the looming question — what will the role of any intellectual technical skill be as thin AI membranes become the interface between our thoughts and actions? It feels like the nerds have owned the last 20 years but it will be comically pyrrhic if being a victim of their own success means they will be sent back underground by what Zoolander called the “ridiculously and professionally good-looking”. Better to be safe than sorry. I recommend raising ambi-turners.)
Todd always tells his Jeopardy story in the context of “if you work for SIG and don’t know the right bet to place in Final Jeopardy see yourself out”. I never heard him give the exact set-up of the Jeopardy scenarios he faced until the recent interview.
I took the liberty of trimming the audio for you:
If you are interested in math puzzles, especially the kind trading firms ask, I have just the thing…I spoke to the founder of Quant Questions this week. The site is self-explanatory:
Most of the content is free. There is even a free Discord with over 950 users.
If you want to dive into the paywalled parts use the code MOONTOWER to get 25% off.
[Btw, this is not a paid ad. I’ve done a few of those in the past, they are always clearly marked as such. I’m open to doing them but don’t actively seek advertisers because I’m a bit of a diva with respect to protecting the audience.
The conundrum looks like this: the griftiest stuff pays the most but being a whore is short-sighted so that’s a non-starter. A lot of good stuff will find itself boosted here regardless. I wouldn’t hold great content or product creators hostage by their willingness to pay. It’s hard to get sponsors when you’re like “hey, I love your product, you should pay me to advertise in moontower, but even if you don’t, I’ll boost you because I can’t keep cool shit to myself”.
The few sponsors I’ve had are the Venn overlap of stuff:
I’m happy to promote
Who want to grow with ad spots in letters
Know about this letter
Anyway, just an FYI for those interested in such matters.]
One last thing on this. A reader wanted to brush up on their “gambling” math skills. They were specifically looking for an iOS app that drills topics like stats, combinatorics and probability.
If anyone is aware of such a resource (even if it’s not an app) let me know and I’ll compile a list. I haven’t poked around myself but I’d guess the closest thing you might find in the spirit of the request is some type of poker trainer app. In any case, vetted responses from readers carry weight. Let’er rip!
Money Angle For Masochists
I’m pulling this from the paid section of Thursday’s Dynamic Hedging & Option P/L Decomposition:
💡A note on computing realized vol💡
Realized volatility computed from daily returns is the standard deviation of logreturns annualized by √251*
When computing a standard deviation, it’s common to square the distances of each observation from the sample mean. This will understate the volatility in a trending market. If a stock goes up 1% a day, you’ll compute a realized vol of zero.
In this example the logreturn stream for IWM for those dates is +3.94%, +1.18%, +1.69%, +3.20%. That stream has a standard deviation of 1.29%. Annualized, that’s 20.4% realized vol.
Does that return stream really feel like just 20.4% vol?
Of course not. The issue is the mean return is 2.50% so the deviations are not large.
If we instead skip the step of subtracting from the mean (which is equivalent of saying the mean is 0) then we get a realized vol of 50.1% which feels closer to reality. After all, if we moved 2.5% per day the realized vol would be approximately 2.5% * 16 = 40% vol.
*Don’t forget Juneteenth
From My Actual Life
I’m using this section to boost a designer who is also a local friend.
If you're looking for freelance design work you should meet Anna.
This is her site:
The moontower personal brand logo and moontower.ai wordmark are her work as well. She's also a sick artist and it was actually her album covers that drew me to her work. These are from Unicorn Taxidermy:
The unicorn in the 4th pic was something she had physically made (it’s in her house).
We are ideating on the art design for a moontower fuzz pedal because that’s what I call swag.
*Zvex is a pedal manufacturer that lets you customize their pedals with your own art. The custom gallery is groovy.
Which reminds me…it’s about that time.
Stay Groovy
☮️
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Figgie.com is the desktop version of the game created by Jane Street to train traders. It is faster for building 'betting' skills than poker is, but poker is deeper. There is an app for both IOS and Android.
I've played a ton over the last four days. Each round is only 4 minute, they have bots you can play against. The hard bots aren't bad. The easy bots are sometimes much more confusing as they do some dumb stuff and make it hard to know where to place bets. You'll understand if you play.