The Deipnosophist

Where the science of investing becomes an art of living

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Location: Summerlin, Nevada, United States

A private investor for 20+ years, I manage private portfolios and write about investing. You can read my market musings on three different sites: 1) The Deipnosophist, dedicated to teaching the market's processes and mechanics; 2) Investment Poetry, a subscription site dedicated to real time investment recommendations; and 3) Seeking Alpha, a combination of the other two sites with a mix of reprints from this site and all-original content. See you here, there, or the other site!

16 April 2013

Living and Learning with Investment Advice

Living and Learning with Investment Advice

We are born as innocents. We are polluted by advice.
- Henry David Thoreau

TipRanks was not started as a labor of love.  It was actually a labor of frustration.

Back in the day, CEO Uri Gruenbaum was a software engineer from Tel Aviv, Israel managing large scale national technology projects. He also was a part-time investor. He didn’t have a lot of skin in the game, but enough to hurt when the stock market didn’t go his way.  He was a typical investor.  And, like most investors, he sometimes relied on the recommendations of financial experts.  The unfortunate thing was many of the recommendations he followed were flat-out bad, which truth angered Uri - even though he was fully aware of the universal truth, caveat emptor (buyer beware).

Uri wondered whether it was just him.  Did he, perhaps, have a singular knack for picking and following the advice of under-performing financial analysts? But how do you go about figuring out whether an analyst even knows what he is doing? They don’t publish a weekly poll of the top 25 financial analysts, like they do for college sports in the U.S.

“I just felt there was a glaring need in the marketplace for a mechanism to help guys like me,” said Gruenbaum.  “What’s out there that can inform and educate the individual investor regarding financial advice when deciding to buy, sell, or hold a stock.”

So Uri decided to do what any smart man with an MBA would do.  He started measuring.

He decided to take a close look at one of the analysts that he followed regularly (someone who had just rated a stock as a "strong buy") and, for starters, he Googled him.  He then calculated the analyst's performance by mimicking all his past recommendations (buying when he rated “buy” and selling when he rated “sell”).  A tedious task, sure, but the results were shocking -- and not in a favorable way.  After more research, Uri noted that almost every time this analyst posted a rating the stock behaved accordingly during that one day, with trading volume way over its daily average; meaning Uri was far from the sole investor who followed this particular analyst's recommendations.  Clearly there was a problem.

So Uri, along with co-founder Gilad Gat, a fellow software engineer (and current CTO of TipRanks), and renowned Cornell University Finance Professor Roni Michaely (who now sits on the TipRanks board), set out to develop the very first mechanism that helps protect “the regular guy” from under-performing financial experts worldwide.

TipRanks developed its proprietary Financial Accountability Engine™ and NLP (natural language processing) algorithms to scan and interpret relevant financial text from the entire Internet.  It ultimately produces names to follow and recommendations to track.  As an individual investor, you no longer watch the game in the dark -- you now know the players' stats.  For the first time, the element of accountability is a reality for professionals who provide financial advice.

TipRanks provides answers to the most basic questions regarding anyone providing financial opinions," Gruenbaum said.  “Who are they?  Are they reliable and accurate?  What is their track record?  Are there better opinions out there?  And, the most important question - should I listen to this particular person?”

TipRanks now virtually “follows” more than 5000 individual analysts’ recommendations.  (And growing rapidly.)  Then, and with zero bias, it reports results based on performance and ranks accordingly.  All this information can be found within a simple co-browser downloaded for free.

With the TipRanks co-browser installed, it’s now possible to see the measured performance of anyone who provides financial advice by simply clicking on his or her name.  Investors also can search for a particular stock and see what top performing analysts say about it.  It also provides real time recommendations on a particular stock made by the top-ranked analysts.

“Financial analyst stock advice can often be biased with their own interests at heart,” says Professor Michaely. “TipRanks is a disruptive technology that will force analysts to be more accountable for the advice they publish, knowing that their success rate will be made available to the public.”

What have the people who developed TipRanks learned so far?  Based on the tens of thousands of publicly posted stock recommendations tracked since January 2009, the majority of them under-performed the market.  The good news is some analysts are better than others.  With TipRanks, you can see who they are, how and why that is, with precision and clarity.

The TipRanks service is free for now.  It will continue to engage with users in order to improve the service and add features.  In the future, the company's founders hope to be in a position to charge for premium features.  The alpha version (found at currently supports professional sell-side analysts. But soon, the company says it will support financial bloggers and technical analysts as well.

Invest wisely.

27 July 2012

Cloud Atlas, the movie

Based on David Mitchell's phenomenal novel, now the movie...

Inspires you to see the movie, if not read the book.
-- David M Gordon / The Deipnosophist

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20 June 2012

First Period

Her First Period is a ~5 minute comedy skit by The Frantics - but that description does not do justice to its utter hilarity. I was laughing so hard that...

How about you - do you find it equally funny...?
-- David M Gordon / The Deipnosophist

(Thank you to Harvey A for the link.)

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19 June 2012

Stupid, stupid, stupid

Sure, I am long the stock, and know a higher price will occur soon. But leave apart the writer's and my dueling banjos perceptions of the same stock, and think on his imbecilic recommendation...

Short Heinz/HNZ at $55, with a stop loss at $61.73, or 12.23% Your profit objective is $51.63, or 6.12%... $6.73 of risk, $3.37 of possible profit. In essence, an abomination of the typical relationship between risk and reward.

Did I say stupid? I also mean misguided, irresponsible, and wrong. Horribly wrong.
-- David M Gordon / The Deipnosophist

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16 June 2012

The hoops she must jump through!

And all that...

... just for a glass of red, red wine. 

Thank you to Harvey A for the link! 
-- David M Gordon / The Deipnosophist


02 June 2012

Jerusalem from above, in IMAX 3D

Okay, okay, so it is a promo for the movie that comes next year. But that makes this video no less impressive...

What do you think?
-- David M Gordon / The Deipnosophist


30 May 2012

Make it Count!

Make it count indeed...

Love this video!
-- David M Gordon / The Deipnosophist


11 May 2012

A murmuration

I have seen several videos of murmurations, but none more startling, due mostly to the two women's unabashed joy, than the one below...


What a find! Thank you to Liz C for the link.
-- David M Gordon / The Deipnosophist


07 May 2012

The Beauty of Pollination

Beautiful. Miraculous. Beautifully miraculous. Miraculously beautiful...

Love it. Hope you enjoy it as well.
-- David M Gordon / The Deipnosophist


17 April 2012

What to do when bored at the airport?

Perhaps I am easily entertained - or, more likely, the video below of four guys bored at an airport and their antics actually is funny...

Are you laughing?
-- David M Gordon / The Deipnosophist


03 April 2012

A headline that sets my blood to boil

First, the headline...
Allegiant Travel to charge $35 carry-on fee

Okay, if you are like me and travel a lot, you too can now set your blood to boil.

Questions arise immediately: What qualifies as "carry-on"...? All the luggage that passengers yoke behind them, of course, in the now forlorn attempt to avoid the checked bag fee. (And for which adequate cabin space is non-existant.) But also perhaps...

- Briefcases?
- Purses?
- Wallets?
- A bag for baby items?
- A bag for your magazines and books?
- The bag that holds your food and drink? (For which you paid an extortionate price because you were on the wrong side of Checkpoint Charlie, aka, TSA)
- Crutches and canes?
- Your arms? (You 'carry' them, as opposed to your legs that 'carry' you.)
- Etc

I admit the list grows silly - the folly of relying solely on a headline - but wonder: When and where do these fees end? I recall with disdain RyanAir's fee to use the toilet on the company's planes.

Are you as pissed as me?
-- David M Gordon / The Deipnosophist

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02 April 2012

Liberal vs Conservative

Woody Allen vs William Buckley...

This video makes it seem too long ago, especially in today's poisoned environment, that people with opposing perspectives could gather and talk positively, with no rancor. And yet, as a few of the questions make painfully clear, 1968 was as troubled as 2012. (Obviously so, for those who recall 1968.)

Thank you, Ray S, for the link.
-- David M Gordon / The Deipnosophist

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31 March 2012

The iPad's magic

Really a wonderful act...

With added color here.
-- David M Gordon / The Deipnosophist

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25 March 2012

Happy Birthday (blues), Josh

Two Nelson, BC (Canada) grandparents recorded this song, and its hilarious video, for their grandson’s 18th birthday...

CNN and ABC each have featured the video; deservedly so, I believe, as it brings a smile to my lips!
-- David M Gordon / The Deipnosophist

PS: Thank you to Harvey A. for the video and link.

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