Content Lead @Delphi_Digital | Not Financial Advice | Opinions Are My Own
Rainbow Road
Joined October 2022
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This is how I performed trading stocks and options this year.
Overall it was a little over the place since I was learning a completely new sector and never took options seriously before.
Originally I started trading spot with AI stocks like SNDK and MU. I was doing pretty well until the big semis crash. After that I tried to sell options with some level of success.
The idea was to keep selling options with higher IV where the r/r benefited me. It basically works until it doesn't and then it becomes time to switch strategies. After that I made some boneheaded plays and here we are.
I'm still up overall but down from where I could be due to silly mistakes.
Heading into 2027 I've started to buy some leaps for longer term holds. In choppy environments like this I think it makes sense to have longer time frames for core positions and hold a good portion in bonds to allocate accordingly in a market crash.
I don't think next year will be nearly as straightforward as 2026 for risk assets but there will be always be opportunities somewhere.
Building is one of the biggest quality of life changes you can do today.
On social channels it's estimated that only 5-10% of people create actively. The vast majority of people consume.
Create. Build something for yourself. Put yourself out there even if you feel uncomfortable.
Nothing has to be perfect. Just focus on doing first, learn from the results, and improve your craft over time.
If you can do that consistently you are already ahead.
Minty retweeted
A new episode of Hivemind is out now!
This week the team discusses whether the worst of the selloff is over, how the Anthropic IPO could trade, why stocks onchain have stalled and more.
Timestamps
00:00 Intro
00:45 Is the Worst Behind Us?
07:48 Why the Macro Models Are Cautious
10:25 The Nvidia Wild Card
16:11 Never Sell the Singularity
19:23 AI Stocks at COVID-Low Valuations
24:33 Meta's AI Bet Is Priced at Zero
28:01 How the Anthropic IPO Could Trade
34:00 Will Anthropic Wipe Out SPV Buyers?
38:04 The Mystery Morning Seller
39:42 ZEC in the Wall Street Journal
41:14 Why Stocks OnChain Stalled
44:28 Can Elysium Skip the Launchpad Trap?
50:48 Is ETH's Store of Value a Hail Mary?
56:14 MegaETH Pivots to AI Inference
Never be a bear
It's important to know when to be risk off, but being a bear is a position of fear. When all you see is red and pain, you are unable to see opportunities in front of you.
Then when markets recover, bears are unable to change their biases. They constantly look for evidence that supports their views without ever admitting they were wrong.
Don't be that person.
Minty retweeted
Our new report “Kinetiq: Building the Hyperliquid Economy” is live!
Trading on Hyperliquid has grown faster than the block space its apps run on. Kinetiq is building Elysium to give those apps 100 times the capacity.
Read the report here.
delphi.link/Kinetiq
I flip flop on ideas regularly, sometimes within a day of taking trades.
People here give you flack for this, but if you aren't revisiting your ideas regularly I would be more concerned.
If you never change your beliefs you are basically assuming you are never wrong which is a flawed way to approach markets.
You always need to adjust your priors to new information that comes out.
If you can't admit you are wrong you could end up wasting a ton of time and money that would have best been spent elsewhere.
Be fluid. Strong opinions loosely held.
Qualities of a Great Trader
- Understands their strengths and weaknesses
- Flips bias at a dime and update priors quickly
- Doesn't spiral after losses and understands that variance happens
- Has a knack for finding the right venues to play at
- Thinks probabilistically instead of deterministically
- Knows when to be patient and when to risk more
- Always puts survival and risk management first
- Views trades as part of a system not individual parts
- Understands the correlation behind held assets
- Focuses on consistency over hitting it big
- Loves the game they play
- Takes fewer trades with longer time horizons
- Stays fluid in beliefs and execution instead of relying on strict systems
TA is largely bs
You can't bring strict systems into a dynamic market environments and expect them to work.
Just because assets had certain patterns in the past does not mean its guaranteed to do the same in the future.
This is why I largely avoid TA as a concept. There are certain indicators that help you see things that a normal candlestick chart can't but you can't use it as proof that it has to happen again.
Whatever indicators you are using, think about what this is telling you and why it's important. If you can't articulate that it's probably best to cut it out.
You can't overfit certainties in an inherently uncertain market.
What would I do if money were not a problem
I think I would be doing the same thing. At some point it's not about the money. It's about winning and crushing my counterparties fairly.
I don't care about cars or watches or houses or parties or status.
I just want to prove to myself that I can do this well.
Dunno if anyone else ever feels that way.
Most of this isn't real.
PNL screenshots and results can't be proven.
Many people only post their wins and not their losses.
Survivorship bias is real. Posturing is more common than ever.
It's hard. I get it. But chances are if you are up historically from trading you are doing better off than most people here.
Please don't fall into the trap of feeling like you need to make it now. Markets feed on impatience.
As time reminds us again and again
The weirdest part of CT is how it recalibrates your brain.
IRL things are fine. Then you scroll CT for 20 minutes and suddenly you feel behind because someone younger than you just posted a life-changing PnL.
It's not even envy exactly. More like your internal scoreboard gets hijacked. You feel behind. Even though you’re doing well. The number that felt like freedom last year feels mid now, and you know it's stupid while it's happening.
I've been at Delphi for close to two years now.
What the team has been cooking up the past few months has gotten me the most excited since I first joined.
There is still a lot to do but looking forward to having everyone see it.
Had a member ask me what I think about Blockworks going down the data route and why Delphi never went down that path
To be completely honest, we tried to build a data product a few years ago. Was really fucking hard. Getting the data was one thing, but standardizing and maintaining it was much harder than we had anticipated. Post FTX, we decided to not burn more resources chasing that direction even though we thought it could be valuable.
Its why I give @JasonYanowitz, @0xngmi, and @Adam_Tehc a lot of props. Got to spend time with each of them irl this summer (yes even @0xngmi) and made sure they knew how proud they should be for pulling off what they’ve done so far.
Often you don’t know how much work goes into something until you do it yourself. Over the years at Delphi, we’ve done a lot - Research, Consulting, Incubating, Investing, Media. All I’ve learned is that everything is hard and takes real effort. So you really have to be excited and passionate about what you choose to do, and when you commit: go all in.
As for @Delphi_Digital, we’re doubling down on Research. It’s been a core part of our DNA since the very beginning, and we feel it will only be more important as a signal in an accelerating world with more and more noise. Excited to share more about this in a few weeks.
How to understand risk
I think of risk as a fundamental concept of how much you can lose in tail risk scenarios and how it will affect your overall portfolio.
It's less a calculation and more of a mentality. If there is any theoretical move in the market that can wipe you out, you are probably risking too much.
But realistically the S&P isn't going to zero. And so instead people generalize the probabilities for moves based on historical events, standard deviations, and statistical data.
Risk, volatility and position sizing are intertwined. Everyone trades differently but overall it makes sense to size less into low vol assets and vice versa.
And the funny thing is risk is the least discussed topic on any market discourse, but it is just as important as asset selection.
If you can't manage your risk properly you are statistically guaranteed to blow up one day.
The more I learn about trading and the more experienced traders I observe, the more I realize there is no secret recipe to success.
There is no single system that works best for everyone. Trading is highly individual, unless you’re approaching it from a purely quantitative perspective.
I’ve come to realize that risk management, position sizing and psychology are by far the most important factors.
These should form the foundation of your trading system, not the analytical tools you use.
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Minty retweeted
Had a member ask me what I think about Blockworks going down the data route and why Delphi never went down that path
To be completely honest, we tried to build a data product a few years ago. Was really fucking hard. Getting the data was one thing, but standardizing and maintaining it was much harder than we had anticipated. Post FTX, we decided to not burn more resources chasing that direction even though we thought it could be valuable.
Its why I give @JasonYanowitz, @0xngmi, and @Adam_Tehc a lot of props. Got to spend time with each of them irl this summer (yes even @0xngmi) and made sure they knew how proud they should be for pulling off what they’ve done so far.
Often you don’t know how much work goes into something until you do it yourself. Over the years at Delphi, we’ve done a lot - Research, Consulting, Incubating, Investing, Media. All I’ve learned is that everything is hard and takes real effort. So you really have to be excited and passionate about what you choose to do, and when you commit: go all in.
As for @Delphi_Digital, we’re doubling down on Research. It’s been a core part of our DNA since the very beginning, and we feel it will only be more important as a signal in an accelerating world with more and more noise. Excited to share more about this in a few weeks.
Moats in the Age of AI
In the age of engineering a decade ago, the meta was hard skills that are rare and difficult. I distinctly remember many parents pressuring their kids to learn hard skillsets to study engineering or law.
Now a decade later you are starting to see a shift from hard skillsets to soft skillsets. People are starting to see the value in generalists, storytellers, creatives that are able to use the inputs of AI in novel ways.
I think this is where the real wedge is. Average prompts and directions will lead to average outputs. This is inevitable when everyone has access to the same tools.
And so the moat lies in the stuff that you can't automate. Having the technical knowledge to steer towards more creative outputs, connecting the dots to get results, authenticity, branding, interpersonal relationships, etc.
This doesn't mean that everything you learned is useless. Designers can probably use AI to design more unique interfaces than the average person. Engineers probably understand system design better than me.
But the goal has shifted from task checklists to how you can use tools at your disposal to produce something valuable.
And this is where the creatives can really shine.
I liken this to Russian Roulette.
You make a few good trades. Momentum is good so you trade more. Your portfolio is up. You're on a heater.
So you start to add more risk. You have more money now so why not?
You crush it as the wind is in your favor and think you are unstoppable.
Then the music stops, a black swan event occurs, and you are suddenly down 30%.
You start to fixate on your previous ATH and make some reckless trades. You get impatient.
But you don't realize the market has changed.
And so you get yourself chopped up trying to chase that dragon before inevitably giving away what you once had.
The truth is it never existed. It was just an illusion.
Lots of people who were levered up to the tits got crushed today, I’ve always been very long term risk averse and short term risk on when an opportunity presents itself compared to most people in crypto. When I would make a large sum, I have always off boarded it all into the S&P & QQQ which over the long haul has served me very well. I’ve watched many people who did not & used to be much better off than me become far poorer.
You don’t need to make it all at once, you have much more time than you think you do. The only time you are really down & out is if you throw in the towel or if you blow it all up. Keep your blood in your head and your feet on the ground, good things come to those who wait.
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A bit embarrassing but I have a hard time maintaining close friendships.
I would say the big lesson is that friendships are like flowers. You need to be the one to maintain them. Send them a quick message. Actually making the time to make plans without saying stuff like "Maybe" or "One day."
If that's something that you can't do because you have other priorities. That's fine. Life is opportunity cost.
But from someone that hyper focused on certain goals in life, one of my big regrets is not taking the time to connect more with others. It's still something I'm working on.
It's never a waste of time if you are having fun.
A lot of people like to ask if its time to buy the dip.
I think the right answer to that is "For whom?"
If you are already overexposed to tech and categories with similar beta, would more exposure actually help you or increase your risk for mass drawdowns?
Likewise if you are overweight bonds and have a longer time horizon, the risk reward seems much better because you are historically underweight risk.
The issue with market commentary is that it overfits binary answers to a multitude of different scenarios.
And this is why you see vastly different results over time.
The question shouldn't be "Should I buy the dip?"
It should be "What would buying here do for me?"
If there is one thing to take from today its that reflexivity works both ways.
Meteoric rises are followed by brutal downturns. Equal parts joy equal parts pain.
Don't be a hero. If you are in any situation where any move could wipe you out you are overexposed and not managing your risk properly.
The people who are left are the ones who survive through any drawdown and have the capital to position after the masses get washed out.
This too shall pass.
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Minty retweeted
A new episode of Hivemind is live!
This week the team is joined by @0xOmnia to discuss what’s behind the AI selloff, the uncertain future of self custody, why Hyperliquid needs an L2, and more.
Timestamps:
00:00 Intro
00:39 The Midterm Cycle That Always Repeats
03:31 Why Privacy Helps Security
05:44 Does Gridlock Kill the AI Trade?
15:38 The Biggest Hedge Fund Deleveraging in Years
19:12 Is the Selloff Overdone?
22:47 Will Democrats Come for Trump’s Crypto?
25:39 Prediction Markets Turn on JD Vance
32:17 How Binance Got Hacked
36:08 Is Self Custody Dead?
41:24 Why Hyperliquid Needs an L2
49:57 What Launches on Day One
These are the times to be looking for opportunities not cower away in fear.
If you got washed out completely then you need to take a hard look in the mirror and figure out why because that should never happen ever.
I'm not going to say this as certainty but it's typically better to bid after a large amount of people are forced out of trades.
This is where you see real discrepancies in price that you can take meaningful advantage of.
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