Hacker News Reader

Interesting. After watching the show Billions, and reading up on how much money hedge fund managers make on fees (seems totally ridiculous), I wonder how common is illegal insider trading for hedge funds? No matter how good your model is, you won't beat someone with information your model doesn't have.

View on HN

Read up on SAC (Point72). Quite a bit of insider trading.

It isn't just about having great models. 51% of the world can't beat the median return. Everyone has great models. It's figuring out where the models are wrong that matter. (Example 1: Most Mortgage models assumed that housing values in all US markets couldn't go negative at the same time) Sometimes that's by qualitative insights. But that's very very hard. And sometimes it's by having someone give some info that they shouldn't.

Reply on news.ycombinator.com