Fri/22.09.2017 11:41

Disclaimer

Read the following disclaimer terms and conditions carefully before accessing this website. If you agree with the terms and conditions of this disclaimer, click "I agree" below and enter the website. By clicking "I agree" you represent and warrant that in accessing the website you have informed yourself as to the legal requirements within the countries of your nationality, residence or domicile and that you are not causing Qbasis Invest GmbH to breach any of the laws or regulations of those jurisdictions.

Information provided in this document:
The contents of this website were drawn up with the greatest possible care and researched by using sources classified as reliable. Certain information included in this document is based on information obtained from sources considered to be reliable. However, any projections or analysis provided to assist the recipient of this document in evaluation the matters described herein may be based assessments and assumptions and may use one among alternative methodologies that produce different results.
Qbasis Invest GmbH does not assume any liability or warranty for the correctness, completeness and topicality of the information provided herein. Furthermore, Qbasis Invest GmbH does not assume responsibility for any damage that might be caused in reliance on the contents of this ducument. Any use of the information provided herein is thus at the sole risk of the user. This information provided here should, if necessary, again be checked and affirmed by an independent body. Any contributions by named individuals represent the opinion of the respective author and not necessarily the view of Qbasis Invest GmbH.
This document may contain confidential and/or privileged material. The publication of information provided on this website by unauthorised third parties is prohibited. This website is not addressed to persons in any jurisdiction except under the circumstances that will result in compliance with any applicable laws and regulations. Persons to whom this website is communicated should inform themselves about and observe any such restrictions.

Non-binding nature of the provided information / intended recipients of the information:
The information provided on this website is of a general nature and does not amount to any legal, tax or investment advice. The information provided on this website must in particular not be understood as an offer for the acquisition of any of the products described herein, as a request for making such offer, or as a corresponding advertising.
Moreover, the information provided herein neither provides any decision aid on financial, legal, tax or other consulting matters, nor must any investment or other decisions be made solely on the basis of the information provided on this website.
Therefore, to the extent permitted by law, neither the Fund nor any of its agents, service providers or professional advisers assumes any liability or responsibility nor owes any duty of care for any consequences of any person acting or refraining to act in reliance on the information provided on this website or for any decision based on it.

More detailed information on any investment products described herein can be found in the corresponding prospectuses. Subscription can be made exclusively on the basis of the respective, solely authoritative prospectus. In particular, the risk indications contained therein should be carefully read before any investment. In addition, it is recommended that you obtain advice from a lawyer, tax consultant, auditor or other advisor in order to examine whether the form of investment is suitable against the background of your own financial, fiscal and other circumstances. The offer and sale of investment products on which information is provided herein is restricted or prohibited by law in specific sovereign territories. Persons who are subject to the jurisdiction of such sovereign territories must independently obtain information about such restrictions and are obliged to comply with them.
Therefore, the information provided on this website is not addressed to any persons subject to a jurisdiction in which an offer would be unlawful.

All information on this website is not designed for U.S. citizens or permanent U.S. residents (green-card holders). Participation in investment products described in this web page should not be offered in the United States of America nor be sold to or on behalf of U.S. citizens or U.S. residents. A U.S. citizen is defined as:
An individual having his/her residence within the United States of America;
A general partnership, limited company or private company, or any legal entity founded in accordance with U.S. American laws or having its main place of business within the United States of America; Any assets, funds, establishments, trusts or mutual funds whose income is subjected to United States income tax, regardless of its origin; or Any legal entity founded for the purpose of passive investment, such as a commodity pool, investment fund or similar legal entity (not however legal entities offering pension plans for employees, managers or executives having their main place of business outside the United States of America)
1.) in which U.S. citizens or permanent U.S. residents hold shares of a total of 10% or more of the capital of the beneficiary, or
2.) whose main purpose consists of the investing on behalf of a U.S. citizen or permanent resident within a commodity pool or mutual fund, the execution of which the fund manager is not licensed according to the provisions of article 4 of the CFTC regulation, with the exception that all persons represented by the fund manager are not U.S. citizens or permanent residents.
Investment products and information mentioned on the following pages are not intended for distribution in the US. Therefore, they do not apply to US residents according to Rule 902, Regulation S, Securities Act 1933 (in particular American citizens or persons permanently resident in the US).

Qbasis All Trends UCITS Fund:
Shares of Qbasis All Trends UCITS Fund are only offered publicly in Ireland, Germany, Austria, The Netherlands and the UK. In Switzerland Qbasis All Trends UCITS Fund is exclusively available for qualified investors. The representative of Qbasis All Trends UCITS Fund in Switzerland is Hugo Fund Services SA, 6 Cours de Rive, 1204 Geneva (www.hugofunds.ch). The place of performance and jurisdiction for Shares in the Fund distributed in Switzerland are at the registered office of the Representative.
The prospectus of Qbasis All Trends Fund, all other fund related documents and other products mentioned in this document are available at Qbasis Invest GmbH, Brückenkopfgasse 1/5, 8020 Graz, Austria.
Any such solicitation or offer, if made, would be made only by way of a formal Prospectus, including any supplements thereto, which must be received and reviewed prior to any investment decision.

Qbasis All Trends UCITS Fund is not available for subscription or purchase by persons resident in Hong Kong or Singapore except under prescribed exemptions under the laws of those jurisdictions. In Hong Kong, products managed by Qbasis Invest GmbH are not authorized by the Securities and Futures Commission. Only persons who qualify as professional investors under the Securities and Futures Ordinance are eligible to apply for shares of such funds. In Singapore, the Qbasis All Trends UCITS Fund has been recognized by the Monetary Authority of Singapore as a restricted scheme. Accordingly, institutional investors and relevant persons (as defined under the laws of Singapore) are eligible to apply for shares of the fund. In Japan, only qualified institutional investors (as defined under the laws of Japan) are eligible to apply for shares of funds managed by Qbasis Invest GmbH pursuant to an exemption and subject to resale restrictions. No persons other than qualified institutional investors are eligible to apply for shares of products managed by Qbasis Invest GmbH which are not registered with the Director of Kanto Local Finance Bureau of the Ministry of Finance.

Please note that the charts, graphs and descriptions of investment and market history and performance contained herein are no guarantee for the future performance. Please also be aware that the investment strategy and the techniques set forth herein are only guidelines and in no way restrict the investment manager from exceeding such guidelines or employing other additional guidelines, as it deems appropriate, in its sole discretion.The simulated performance of the Qbasis All Trends strategy concept has been calculated by using 75% Qbasis i Trend Index (ISIN: AT0000A11459; Bloomberg: QBIX) and 75% Qbasis q Stocks Index (ISIN: AT0000A12YQ6; Bloomberg: QBSX). Qbasis i Trend Index and Qbasis q Stocks Index are simulated, non-investable indices listed on the Vienna Stock Exchange. However since April 2007 various investment products are based on the Qbasis i Trend Index. There is no guarantee that future performance will be similar to the past performance of the indices.

Risks:
Hedge funds are considered highly speculative investments. No assurances can be made as to the returns experienced by the fun. There can be no guarantee that the investments made match the projected or historical returns, since past performance is no guarantee or indication of future results. A loss of the entire amount invested cannot be precluded. Any person subscribing for any investment must be able to bear the risks involved and must meet the suitability requirements relating to such investments. Some or all alternative investment programs may not be suitable for certain investors. The actual performance realized by any given investor will depend on, amongst other things, the product invested into, the class of shares/interests subscribed for the period during which such shares/interests are held and in what currency such shares/interest are held.
All potential investors must especially pay attention to the following risks: (1) The products investment program is speculative in nature and entails substantial risks; (2) the investments underlying the product may be subject to sudden and large falls in price of value and there could be a large loss upon realization of a holder’s investment, which could equal the total amount invested; (3) the use of a single adviser could mean a lack of diversification and, consequently, higher risk and may depend upon the services of key personnel, and if certain or all of them become unavailable, the product may prematurely terminate; (4) the investment manager will receive performance-based compensation, which may result in riskier investments; (5) the product is subject to certain conflicts of interest; (6) certain securities and instruments in which the product may invest can be highly volatile; (7) the investments which underlie the product may be leveraged and (8) changes in rates of exchange may also have an adverse effect on the value, price or income of the investments which underlie the product.

External Links:
Direct and indirect references from foreign sites (hyperlinks) do not fall under the legal responsibility of Qbasis Invest GmbH. The operator of this website accepts no responsibility for the content of materials found in references or links and therefore extends no warranty. Foreign sites underlie the responsibility of the provider. The linked sites have been verified at date of linking in order to avoid infringement. No unlawful contents have been identified. On-going control of contents of external links is not reasonable without precise indication of infringement. At emerge of infringement the operator of this website will close such external links immediately.

Copyright:
All contributions and illustrations on this website have been copyrighted. At all times the operator of this site aims to respect the intellectual property rights of others regarding charts and texts and will, whenever possible try to use self-developed or free of licence contributions. Possible contributions of third parties will be marked. Unless hereinafter marked the repetition of contents is not allowed. Any utilization of non-authorized material is subject to approval of the respective author. This applies especially to any duplicating, adaptation, translation, processing or repetition of contents found in databases or other kind of electronical media and systems. The use of photo-copies and downloads from websites is for private and non-commercial use only. Any duplication or distribution for professional purpose is strictly forbidden.

Non-Liability:
All information herein has been meticulously checked for accuracy. There will be no liability for possible typographical errors or misprints.

Legal effect of this disclaimer:
This disclaimer is to be considered as part of descriptions and information given on this website. If any individual or collective part or formulation of this text does not at all, or partially or completely correspond to what is legally required, the content and validity of the remaining parts of the document remain legally unaffected.
 

A discussion of risk, intelligence and trading (3 parts)

Part 3 of 3 

If you want to read part 1, please click here...

If you want to read part 2, please click here...


If only a small percentage of people are risk-intelligent, would you agree that systematizing at least the probability estimation process (and therefore investment process) is a better solution?


For most people, I would say very much so. I think that unless you’ve got the time, resources, skill and energy to become really good at being highly risk intelligent in one particular domain, most of the time you would be better off following a robust process.


Do you think in general that most people are too risk averse and should embrace risk more?


For risk intelligence, you can objectively measure people who are better at estimating probabilities but with risk appetite, it ultimately comes down to personal preference. It doesn’t mean it’s better but I, for example, am ‘risk-loving’ but I find it sad when I see people who are so risk averse they are never willing to try or do anything new. It also depends on the circumstances. You often find that more risk-averse people can make better investors in a mundane market whereas someone who is more of a risk taker is probably more likely to profit from a crash or a raging bull market. But some prominent risk-takers in history such as Livermore or Paulson have made more money on the way down, perhaps because the market has a gravitational human characteristic.


What would you say is more damaging as a trader; overconfidence or under-confidence?


They are both equally damaging and will make you less profitable but as a matter of empirical fact, overconfidence is just far more common. So, given that it’s more common you should be more worried about it. Polar Bears and cars are probably equally dangerous to humans but which are most people worried about?!


In one of your other books on emotional intelligence, you were critical of the idolization of supposedly un-emotional characters such as Star Trek’s Dr Spock. Would you therefore disagree that un-emotional, logical people are better speculators than more emotional or emotionally intelligent people?


Well, at the time I was criticizing the view that the best decision maker would be someone completely devoid of emotion but that’s a bit of a straw man because the sort of emotionless Dr Spock character doesn’t exist. There are situations where it’s useful to have emotions but, having said that, one of the characteristics of good investors and gamblers is they can put emotions to one side when they need to. Good gamblers are cold and emotionless at times and do this naturally when they really need to. If you think about the process of a good speculative decision, you need to take two factors into account; 1) the numeric probability and 2) the expected value. In a way you need to multiply them together. When you’re assessing the probability (number 1), you need to be as emotion-less as possible about the cold hard facts, hence why systematizing this part can solve the problem most people have in this regard. However when you’re considering number 2, the monetary award, you need to work out how important that is to you and how it would make you feel if it worked out in your favour.


Given that on the risk-intelligence test you have in your book and on your website (http://www.projectionpoint.com), if you assigned a 50% probability to every question, you’d emerge perfectly calibrated. Does that suggest that your probability estimates should always be relatively constant?


Not necessarily because you can “game” the test that way. But we can measure how often people use intermediate categories such as 10/20/30/40/60/70/80/90% etc and we give people a point each time they use those intermediate categories, whereas every time they use 0/50/100% they get zero so that forms an index of how reliable their risk intelligence score is. So you can score 100 but get a K score that is very low so you can say that someone has scored well on the test but their risk intelligence isn’t necessarily reliable. On the other hand, if you scored 80 on the test and had a K score of 35-40, that would be very impressive as it forms a much more reliable guide to how risk-intelligent that person is likely to be. If you’re making predictions about geopolitics, assigning a 50% probability on a civil war for example, that wouldn’t really help us prioritise our resources very effectively!


How would you say most traders and speculators can improve their risk intelligence and get closer to this optimum frontier?


I have to say a logical process and plan is vital. Track progress, write down your numeric probability estimates and then monitor how they played out. Score yourself. There is even a spreadsheet that you can download for free from my website so that you can make up your own risk intelligence test and base it on your investment strategy. Keep a trading diary, write down your estimates and then review your performance. By doing this on a regular basis, you can become better at estimating probabilities and hopefully therefore trading as a result.


I quote from the book “By transforming low probability events into complete certainties, especially when the events are particularly scary, worst-case thinking leads to terrible decision-making”. Can you elaborate on this and relate it to trading?


This is the Cheney doctrine where he stated that even if there’s only a 1% chance that Iraq is going to acquire nuclear weapons, we’d better regard it as a 100% chance for the purposes of our reaction which is ludicrous. I think far too many people hugely oversize their bets on a worst case or best case scenario whether it’s a horse winning a race or a view on where the stock market will end up 12 months down the line. Basing your decisions, whether it be a bet, investment or anything else, worst-case scenarios are just as damaging as best case scenarios. It is far better to make a variety of scenarios and assign a numeric probability to each event occurring.


Thank you for the interview!

Germany´s
Hedge Fund Award
Alternative
Investments Award
This fund was ranked based on the data in BarclayHedge's Managed Futures Database