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2025-07-11

Finance course

Haven't made a proper course as it's a not an immediate priority.

Topics I strongly recommend to almost everyone

• Intro to asset classes
  • equity, bonds, crypto, gold and other commodities, real estate
• Intro to derivatives
  • margin trading, quarterly/monthly futures, perpetual futures (popular in crypto), european and american options
• Intro to risk
  • time value of money
  • expected value, variance, sharpe ratio
    • Maximising expected value is not enough, you want maximise expected value given a certain variance, tail risk and time horizon. Two opportunities may have same expected value but one may be way better than the other.
  • tail risk, log utility, kelly criterion
    • Variance and tail risk are two different risks, don't mix them up. Calculate separate values for both.
• Trading in practice
  • understanding orderbook, limit/market orders, stoploss, etc
• Effects of large portfolio size (> $10M)
  • absorb more tail risk (due to log utility)
  • access illiquid but big opportunities
  • pay full-time employees to do analysis for you, thereby increasing expected value of bets
  • illiquid small opportunities are no longer worth your time
    • (if you are trading personal funds, you have comparative advantage in illiquid markets where big players don't bet)

Topics I weakly recommend (depends on your situation and your interests)

• Financial theory
  • Markowitz optimisation, formal proofs surrounding EMH, long-term versus short-term
• Fundamental analysis
  • EBIDTA, balance sheet analysis
• Options trading
  • brownian motion, black scholes model, black scholes as applied in practice
• Liquidation process

Topics I recommend you avoid

• "Technical analysis" - it is mostly a scam

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