How Algorithms Shape Our World

This is a TED talk: Kevin Slavin argues that we're living in a world designed for -- and increasingly controlled by -- algorithms. In this riveting talk from TEDGlobal, he shows how these complex computer programs determine: espionage tactics, stock prices, movie scripts, and architecture. And he warns that we are writing code we can't understand, with implications we can't control.

This is a fascinating talk that really simply and interestingly presents a series of issues around the rise of the algorithms. In finance the markets are increasingly being dominated by computer traders; be they execution modules, tracker and intel modules, pure arb, or even quant trader systems with little to no human intervention. If you work in the markets you need to understand this trend, even if you don't it's very interesting. See also: Quants: The Alchemists of Wall Street, Trillion Dollar Bet (the Midas Formula), Wall Street - The Speed Traders, and The Flash Crash

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/05/how-algorithms-shape-our-world.html

Trading Academy - Episode 6: The Final

This is the final of the series, where the last three traders go head to head to see who will become the best trader - and of course which trader will pick up the 100k prize. Much of the final in the series focuses on analysing the individual traders as they stand before the expert judges; who has had the best performance? who has mastered their trading psychology? who has the most sustainable trading style? and of course ultimately - who will be named the best trader? The final in the series provides a fine completion to the 6-part series in which novice traders compete and learn to become expert traders. Watch the traders in action and learn from others. See also: Episode 1 (meet the candidates), Episode 2 (FTSE Fundamentals), Episode 3 (Global Indices), Episode 4 (Stocks and Shares), Episode 5 (Trading FX) and Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/05/trading-academy-episode-6-final.html

The Age of Big Data

This BBC Horizon documentary looks at the arrival of the age of "big data". While data has been around since the dawn of time, only recently has the technology evolved that has allowed us to more efficiently capture, store and interrogate the data. This has profound implications for financial markets, but it also has many other real world applications. The documentary looks at four case studies on the use of big data, and also looks back a hundred years into the past at a pioneer in the field of big data and epidemiology. First up is a pilot program being run in the city of LA where a massive crime database is used to predict where and when future crimes will happen. Then there's a look at a big quant hedge fund, which employs over 100 PhDs and scientists; taking a scientific approach to trading and investment through the use of an enormous amount of data. Then we see how data can be used to make advertising more relevant and ultra-targeted. Finally the explosion of data is viewed in a cosmological context, with South African astronomers looking to catalogue the entire cosmos. See also: Quants: The Alchemists of Wall Street and Trillion Dollar Bet (The Midas Formula)

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Finance Documentaries: http://www.financedocumentaries.com/2013/04/the-age-of-big-data.html

Wall Street Warriors S02E05

The Wall Street Warriors series follows the careers of a range of Wall Street professionals; across the spectrum of professions e.g. traders, private equity fund managers, investment bankers, stock brokers, and experience levels e.g. rookies, associates, seasoned professionals. This is a very interesting series for those wanting to learn more about what people do on Wall Street (i.e. in the finance industry), and is must see viewing for those interested in a career in finance. It also gives an insight into what their lives are like and how they spend their time, how they think about their careers, etc. This episode is from the second series of the hit Wall Street Warriors franchise.

This ain't easy street …it's Wall Street and Larry can't remember the last time he slept. One of the biggest days in the OJ pit has just arrived and he stands to lose millions if his bets are off. Laetitia is feeling the pressure mount as well. As she approaches her 5th week of training, she contemplates her fate as a day trader and makes some hard decisions.

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Finance Documentaries: http://www.financedocumentaries.com/2013/04/wall-street-warriors-s02e05.html

Trading Academy - Episode 5: Trading FX

In this episode the traders get to grips with the global currency markets; learning to trade foreign exchange instruments (more here). The traders receive advice on trading strategies and tactics from the mentors, and then are set loose on the forex markets. FX trading in particular is a very interesting form of trading as it often involves high leverage and the market can move and react to global events in an instant. You need to manage risks, know where the trend is, be aware of global macro events and form a view on where the data will print. Whether you trade on fundamentals or on price patterns you need a solid strategy and a strong trading approach - and of course you need to master your trading psychology. Watch the traders in action and learn from others. See also: Episode 1 (meet the candidates), Episode 2 (FTSE Fundamentals), Episode 3 (Global Indices), Episode 4 (Stocks and Shares) and Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/trading-academy-episode-5-trading-fx.html

Chess Grandmaster turns hedge fund manager

Ever wonder what would happen if a chess Grandmaster became a fund manager? Here's you chance to find out first hand with an Opalesque interview with Patrick Wolff. Patrick Wolff is the founder of equity long-short hedge fund Grandmaster Capital, seeded by PayPal founder Peter Thiel. His investment approach is "4 parts Warren Buffett, 1 part Peter Thiel" with a sprinkling of global macro insights. Patrick's background includes time as a chess champion, working the dot com world in Silicon Valley, and then onto work at Clarium - a global macro hedge fund. Wolff is an interesting individual and is well worth listening to.

Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/chess-grandmaster-turns-hedge-fund.html

Trading Academy - Episode 4: Stocks and Shares

In the 4th week the contestants start trading individual stocks; focusing on the pairs trading technique (i.e. long one stock, short another - thereby holding a beta neutral position which gains or loses depending on the stock specific factors). For some the task of picking individual stocks becomes a bit much - with the universe of possible stocks in the thousands; whereas previously they had only a handful of instruments to trade. This episode probably mostly helps on teaching the value of focus; it's also important for emphasising the importance of developing a trading style and a trading plan. Trading strategies need to be adaptable, they need to be profitable of course, but they also need to be sustainable in that they suit the philosophy and beliefs of the trader. Watch and learn! See also: Episode 1 (meet the candidates), Episode 2 (FTSE Fundamentals), Episode 3 (Global Indices) and Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/trading-academy-episode-4-stocks-and.html

The City Uncovered - When Markets Go Mad

This BBC documentary takes you through the so-called "madness of markets". It begins by looking at just what is a market, what role does a market and its participants serve in the economy. Essentially markets exist as a mechanism for price discovery as demand meets supply. As the prices vary, economic agents vary their behaviour and the "invisible hand" adjusts the supply-demand balance. The presenter, Evan Davis, has some interesting interviews with a range of people to get their perspectives; professors, traders, fund managers, mortgage lenders, borrowers, and investment bankers. This documentary offers a fascinating look at the role of humans (and thus the role of psychology) in markets. At the end of the day, markets are made by people, and the behaviour of prices depends as much on the behaviour of people as it does on the economic fundamentals.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/the-city-uncovered-when-markets-go-mad.html

Trading Academy - Episode 3: Global Indices

In the third episode the competition is becoming stronger as the weaker traders get sent home. This week the traders focus on trading global indexes and use the 'spread betting' technique whereby you go long one related instrument e.g. one stock, and short another instrument e.g. another stock - in that example you remove market risk and retain stock specific risk. This series is an excellent way of getting up to speed with the basics of trading and also becoming aware of the pitfalls and risks as well as the challenges of mastering not only your trading system and trading style, but mastering your own trader psychology. The contestants show the learning in action, as well as getting vital tips and hints from the experts. Watch and learn! See also: Episode 1 (meet the candidates), Episode 2 (FTSE Fundamentals) and Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/trading-academy-episode-3-global-indices.html

Bulls & Bears - SFE

This is a promo for the documentary "Bulls & Bears" - a documentary about futures traders on the old Sydney Futures Exchange (SFE - now part of the ASX, and now digitally traded following the closure of the open outcry trading pits). The documentary follows the plight of a group of local traders around the time of the Asian financial crisis; seeing what works and what doesn't in the high stakes world of futures trading. Much of the trading was interest rate futures e.g. bets on rates going up or down, or changes in the shape and structure of the yield curve. This type of trading requires large amounts of capital and can see rapid gains or losses based on global macro events, changes in sentiment, and central bank policy announcements, among other things. Note, I will try to track down the full documentary - please comment it below if you have it.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/04/bulls-bears-sfe.html

Black Wednesday - When the Pound Sterling Crashed

What happened when the pound sterling crashed? Why did it crash? And what was this thing about George Soros taking on the Bank of England and winning? This documentary addresses all of these questions and more - it looks at a financial crisis which happened back in 1992. Black Wednesday referred to the day where the UK was forced to withdraw the pound or GBP from the European Exchange Rate Mechanism as the Bank of England was unable to keep the GBP exchange rate above the agreed lower limit. George Soros made over a billion dollars betting against the GBP - foreseeing it's inevitable capitulation. This crisis just goes to show the fallacy of a one-monetary-policy-fits-all approach; it also shows the futility of fighting the market, and how easy a crisis can precipitate. This event also shows how traders can make money in a crisis if they are prepared to do their homework, understand the drivers and get conviction to take a position.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries:http://www.financedocumentaries.com/2013/03/black-wednesday-when-pound-sterling.html

Going Rogue - UK

The systems and processes that banks and financial institutions run are known for being burdensome and bureaucratic. But while compliance has become a growth industry, risk management in financial institutions is perhaps as hard as ever, and as we now know it is not infallible. Indeed the repeated instances of rogue traders over the years shows the risks of workers going rogue in financial institutions. Be it Nick Leeson of Barings Bank, Jerome Kerviel of Societe Generale, or the others; the rogue trader is a risk that investment banks must be ever vigilant of. But others even point to the lead up to the global financial crisis as being tantamount to systemic rogue trading, with poor loans and lax risk management as key drivers of the crisis. Also in the documentary is an ex-Goldman Sachs desk manager who left to pursue a PhD in Neuro Economics - the study of psychology in financial markets. Indeed, it could be that the culture within investment banks encourage risk taking, and has a physiological impact on male traders. See also: Rogue Trader and 25 Million Pounds

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Finance Documentaries: http://www.financedocumentaries.com/2013/03/going-rogue-uk.html

Trading Academy - Episode 2: FTSE Fundamentals

Trading Academy is a new series from City Index that puts 8 candidates against each other and against the market in a bid to become a successful trader and take the $100,000 prize. In this episode the traders learn how to trade the FTSE 100 - a key stock index in the UK. They must learn to master their emotions while also trying to figure out a trading strategy on the fly. Each of the traders finds their own approach - some with success, some with much less success. The best lesson of this episode is about the psychological aspects; seeing in action some of the mistakes they make, and learning how to improve your own trading. See also: Episode 1 (meet the candidates) and Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/03/trading-academy-episode-2-ftse.html

Trading Academy - Episode 1: Meet the Candidates

Trading Academy is a new series from City Index that puts 8 candidates against each other and against the market in a bid to become a successful trader and take the $100,000 prize. In this first episode we meet the traders and get a briefing on the competition. Market analysts, Ashraf Laidi (Chief Global Strategist) and James Chen (Chief Technical Strategist) are on hand to teach the traders tips on how to read the market, how to execute trades, offer tips on trading psychology, and of course grill the losing traders on why they should stay in the competition. This is a very interesting series and offers entertainment value as well as some insights on how to succeed at trading in the markets. Highly recommended viewing. See also: Million Dollar Traders (a similar apprentice-style trading competition where the aim is to train a successful hedge fund manager). Be sure to add your comments below.

.Trade currencies, commodities, and stocks at eToro  
Finance Documentaries: http://www.financedocumentaries.com/2013/03/trading-academy-episode-1-meet.html

Wall Street Warriors S01E06

Wall Street Warriors follows a day in the life of the careers of a range of Wall Street professionals; across the spectrum of specialities and experience levels. This is a very interesting series for those wanting to learn more about what people do on Wall Street (i.e. in the finance/banking/investment/markets industries), and is must see viewing for those interested in a career in finance.

Season one: Episode 5
Buyers lose confidence in the market, stock prices slump: After coming up $300,000 short, Tim loses one of his top investors, not to mention his notorious temper. Sandra is more than a little impressed by the co-founder of the Quantum Fund. Sporting a hedge fund with a 4000% return is proof that portfolio size does matter.

Street Talk:
--Naked Short: When you sell short a security that you haven't properly borrowed

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Finance Documentaries: http://www.financedocumentaries.com/2013/02/wall-street-warriors-s01e06.html

The LME - Europe's Last Open Outcry Trading Floor

This short documentary from the Wall Street Journal adds to a handful of videos on Finance Documentaries which look at the old way of trading - people interacting with people; as opposed to computers talking to computers. "In the first of a new series of training videos, Dow Jones Newswires' Andrea Hotter takes a look at the last bastion of open outcry trading in Europe and one of the few remaining in the world, the London Metal Exchange. Tracing its history from inception to current day, she examines the various ways to trade metals." The London Metals Exchange (LME) is one of the last modern exchanges that uses the old open outcry method of trading. The LME was sold to Hong Kong Exchanges and Clearing Ltd in 2012. See also: Anatomy of a Trade - The NYBOT and LIFFE Documentary and especially see Floored - which details the life of a trader in the pit, and the transition to computer trading.

.Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2013/02/the-lme-europes-last-open-outcry.html

The Food Speculator

This documentary from VPRO Tegenlicht examines the global commodities futures markets and aims to understand the role of speculation on food prices. The presenter raises a small pool of capital to trade agricultural commodities so he can gain a first hand understanding of the role of the speculator. He travels to Tunisia - a country where rising grain prices saw bread become unaffordable; which ultimately lead to an uprising and regime change, i.e. "the Arab spring". He also attends some futures trading industry symposiums to speak to the industry participants and travels to Chicago - home of the CBOT to find out what "good speculators" and "bad speculators" are. When you think about the key function of commodity futures markets, the main purpose is to help producers and buyers of commodities to manage price risk i.e. hedging. Speculators play a vital role of providing liquidity - in other words in order to conduct a futures trade to hedge crop output you need an active market that provides price discovery and low cost and timely trade execution. Interesting viewing, also note parts of the documentary are in Dutch with English subtitles. See also: Anatomy of a Trade - The NYBOT

 Trade currencies, commodities, and stocks at eToro  
Finance Documentaries: http://www.financedocumentaries.com/2012/12/the-food-speculator.html

Anatomy of a Trade - The NYBOT

This short documentary provides a good educational on how trading used to work at the NYBOT (New York Board of Trade), a commodities futures exchange that was taken over and rebranded by ICE aka IntercontinentalExchange. Essentially the NYBOT used to, and still does in its new form, provide: 1. Price Discovery; 2.Price Risk Transfer; and 3.Price Dissemination. The main two instruments traded are futures and options on futures; typically these instruments are used by participants primarily for risk management or hedging, but other participants accept risk i.e. speculators, and others still engage in arbitrage transactions. The documentary provides an anatomy of a trade by a corporate that is trying to hedge price risk and follows the transaction through from idea formation to order to execution and adjustment. Very interesting and educational documentary. See also: LIFFE Documentary and Floored

 Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2012/11/anatomy-of-trade-nybot.html

What Are Economic Bubbles?

What is one of the most exciting phenomenon of finance and economics? That's right - bubbles. Periods of hype, euphoria, mass hysteria, and case studies in crowd psychology - economic bubbles represent the extremes of some of the fundamental forces that drives the financial system, and the real economy. Through history there has been a wide array of bubbles; the tulip bubble, the 1920's stock market boom, and of course the dot com boom. This documentary from the open university focuses on the dot.com bubble where Internet companies were the hot new thing, attracting wild valuations - driven more by the belief in a new age (the new economy), rather than fundamentals or financial strength. These periods of boom provide excellent case studies in investor behavior, they can also be beneficial to society (i.e. when the bubble is driven by a new technology e.g. Internet, biotechnology), and of course some speculators can get rich during a bubble. But bubbles can also be disruptive and damaging - particularly in the case of credit booms such as the enormous credit and housing bubble in the mid 2000's which lead to the global financial crisis. Bubbles are a fascinating and exciting thing to study and experience, and through studying past bubbles we can develop insights on finance, economics, and for our own investing and wealth.

 Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2012/11/what-are-economic-bubbles.html

How to Build Your Own Options Trading Hedge Fund

So maybe you want to trade options or maybe you want to start a hedge fund - this presentation discusses 'how to build a one-man options trading hedge fund'. Dennis Chen and Mark Sebastian, co-authors of the book 'The Option Trader's Hedge Fund- A Business Framework for Trading Equity and Index Options', discuss how you can build your own option trading hedge fund. In the hedge fund world, small size is often an advantage when it comes to being nimble and agile in your trading, but it also means less resources and it means you also have to be smarter about how you run your trading operation. Options, including binary options, provide a means of accessing and implementing a vast range of strategies and can provide the leverage the pay-off ratios required to bring in the larger returns. The key concepts in the presentation include: trading options like a 'one man insurance company', the five essential components of high-profit options trades, management of risks - including black swan risks, and how to build and execute highly effective and efficient trading plans. In a field where knowledge is power and the stakes are high, presentations and information like what these authors present is potentially very valuable, enjoy. See also: trading lectures

 Trade currencies, commodities, and stocks at eToro
Finance Documentaries: http://www.financedocumentaries.com/2012/10/how-to-build-your-own-options-trading.html