A Chicken Little Trade

On Friday, May 8, 2015, I made a change to the Chicken Little Portfolio. In this note, I describe the specifics of this trade, the possible outcomes, and the motivation(s) for the trade. There are exactly 3 possible outcomes to the trade; when one occurs I will edit this post.

Who cares about Chicken Little? 

Before reading on, you might ask yourself why you would care about a trade in the Chicken Little portfolio. 


Federal Reserve Secrets?

If you could ask God one question, what would you ask?  In today's economic world, Central Bankers are demi-gods. Last Friday (May 1st), San Francisco Federal Reserve President John C. Williams gave a talk at Chapman University.

Image result for john c williams san francisco fed
John C. Williams
President, San Francisco Fed

As I walked to the event, I felt the effect of being close to power. There are ten members of the Federal Reserve Open Market Committee, and I was hoping to ask a question of one of those ten powerful people. Think of what you would ask in this situation before reading more. My question was: 


Chicken Little Portfolio Suffers in First Month

On March 30, 2015, I unveiled the Chicken Little Portfolio, which can be viewed publicly. (You can join the contest.) This post is the monthly update for the portfolio. In April 2015, the Chicken Little Portfolio lost 1.18% while the Dow Jones Industrial Average returned a positive 0.40%.

Losing 1.18% in a month is a more dismal than it may appear for two reasons. First, the portfolio is designed for safety. Second, most of the portfolio is in cash or medium term US Treasuries. April’s performance is like losing 50-0 without leaving the bench.


Join the Chicken Little Stock Contest

In March 2015,  I unveiled my investment positions and made them public in realtime.

The best way to learn about financial markets is to trade with your real money. The second best way is to publicly trade a paper portfolio. I encourage readers to enter the Chicken Little contest.


A Trick For Higher SAT scores? Unfortunately no.

Wouldn’t it be cool if there was a simple trick to score better on college entrance exams like the SAT and other tests?

There is a reputable claim that such a trick exists. Unfortunately, the trick does not appear to be real.

This is the story of an academic paper where I am a co-author with possible lessons for life both inside and outside the Academy.

[related post: Top 5 mistakes made by college students.]


Where does Chicken Little invest?

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Today, I am connecting my macroeconomic views to my investment decisions. That means I will disclose my own investment decisions. The following chart represents my current investment position. This is my real financial position, not some target allocation or paper recommendation for other people.


Tesla SEO - Secondary Equity Offering?

Usually I comment on macroeconomic issues. This is a comment on one stock - Tesla (TSLA). The final paragraph connects back to the deeper issue of the Efficient Markets Hypothesis.

Tesla is likely to issue more stock, probably a lot of stock.