Skip to main content

Computational Investing

100% score on Computational Investing, Part 1
About a month ago or so I wrapped up the "Computational Investing, Part 1" course at A few days ago the certificates have been released, so I figured, I write a post showing of my achievement and at the same time share my thoughts on the course.

As the course name implies it is about using computation / computers to go about making investment decisions. The focus is on investing in stocks, but the principals taught in the course easily transfer to other equity types, like Mutual Funds, ETFs, Bonds, Foreign Currencies and maybe even to futures and options. The instructor of the course is Tucker Balch of the Georgia Institute of Technology. Tucker is truly passionate about the field and what I like most is his practical approach to the subject. All computational aspects of the course are done in the Python programming language and there is a Toolkit known as the QuantSoftware Toolkit aka QSTK that will do most of the heavy lifting in the course. Still, I think that you need to have above beginner level Python skills, be familiar with libraries like Pandas, Numpy and matplotlib and have a basic understanding of Statistics to be able to successfully finish this course. If you have this skill level, then the toolkit will really help on being focused on learning and understanding the fundamentals of computational investing without getting lost in the little programming / implementation details. Having said that, I do not think that I will use the QSTK to implement my own strategies, but it is a great learning and strategy discovery toolkit. In all fairness the toolkit has many more features, like machine learning, that I have not discovered (yet)  and that are not covered by the course.

The course covers the following theoretical subjects: Evaluating and Optimizing performance of a portfolio, Sharpe ratio, Market Mechanics, the Capital Asset Pricing Model, the Efficient Market Hypothesis.

Finally, in the course you will set up a backtest framework that uses event studies to generate buy en sell orders and allows for reporting of and optimizing the performance. The purpose of this is mainly to get familiar with the practice of backtesting, learning the nots and bolts and pitfalls like survivor bias, look ahead bias, over optimization, etc. along the way.

In conclusion: For me the course was a great fit to my interests and skills. I gained a better understanding of how the financial markets work and how I can go about backtesting strategies.

Here is a promo to the course by Tucker.

And here is an intro that talks more about the course in detail.

The course is also offered as a signature track, which means that all of your accomplishments are verified so they can be attributed to you without any doubt. I haven't opt for this as my main interest is gaining knowledge to use trading my own account and less so recognition of accomplishments.

Part 2
This course is noted to be Part 1. So what about part 2? Well, there is a preview to part 2 of this course below. Part 2 is about how Machine Learning can help in investing. I would be very interested in taking part 2 of this course and hope it will become available on line soon. Currently part 2 of this course is not being offered on line, but only on site at Georgia Tech according to the info on the QSTK Wiki.

Popular posts from this blog

Invest like a trader

Here is my book: "Invest like a trader". I finally decided to create this book based on my blog and experience investing, trading and coding. It is an introduction to my view on investing. For the next few days you can get a free copy on Amazon:

This book is for you if you are an investor looking to learn a more trading-like approach to investing. Buy and hold investing has become buy and pray investing, with countless sleepless nights. A more trading-like approach to investing puts you back into control of your investments and it can be a lot of fun. After reading this book you should be more able to build and grow your investment account consistently.

Link to the e-book:
Let me know what you think after reading the book. You can contact me via email or on social media. Even better, you can leave a review on Amazon.

Why I am a trader and investor and why you might wanna be one too

I am a coder by day and trader by night! Coding is my day job. I am fully aware that only having a job will not allow me to provide for my family and myself consistently in the long run. This is because most of the western societies are setup in a way to be more and more disadvantageous towards the working middle class. I do not need to be a billionaire to be happy, but our society is becoming more and more binary. It seems that one can either be rich or poor, in which case I opt to be rich, or at least hedge myself against being poor. Trading and investing are my hedge against this trend.

The super rich and us Below are two videos from the BBC documentary "The Super Rich and Us". It clearly illustrates and explains the polarization of wealth distribution in our current society. Here is a catchy quote from the documentary:

There are the haves, the haves not and the haves yachts! But actually we seem to be heading for a society where there are only haves not and haves yachts

Why I buy Gold and Silver

I own crypto currencies, because I have come to the conclusion that money as we know it today is no longer sustainable. I have come to this conclusion during the crisis of 2008. At that time I had the intuition / the gut feeling something was wrong not only with our financial system, but more specifically with our money. It took a few years of researching and investigating until I figured it out. The thing is, part of me did not want to believe it was true. And for a long time I did not act upon the intuition and knowledge I had. That changed last year when I decided to put my money where my mouth is and I started to accumulate crypto currencies. Cryptos align perfectly with my expertises: coding and trading. So I went for it... And with success.

Now I want to diversify my holdings more by adding Gold and Silver to it. I buy Gold and Silver as a hedge or insurance against the undwindled money printing of all of the governments / central banks of the world. Money, or actually, currenc…