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Neural Net Side Project Makes $3500/mo Trading Stocks

93 points| sebyddd | 9 years ago |indiehackers.com | reply

114 comments

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[+] svantana|9 years ago|reply
I may be way to cynical for my own good, but there's no proof that this is actually real, right? Besides a couple of pretty bizarre screenshots [1]. I'm skeptical because a) these types of gains in public markets are pretty much unheard of, and b) faking a story like this would be a fairly easy way of getting lots of attention for your freelancer business (which this guy advertises right at the top of the article).

[1] Running cat on a csv file would usually just print a list of numbers, yes? Instead he gets ascii art with months on the vertical axis, making it seem like time going back and forth, and some random commentary in the right margin. I dunno but something about it screams "mockup". As does the minimalist, ultra-stylish AWS window.

Edit: also, if it were me who got incredible returns from trading at high speed on indian markets using only machine learning on historical data, I would definitely keep quiet about it. Just sayin'...

[+] dangerboysteve|9 years ago|reply
I call BS myself. He's from Romania, maybe living in New York or San Fran whatever profile you read and he's using Indian based trading API's linked to an Indian brokerage.

I also think most of the stories on indie hacker are bull and it's just people growth hacking or something to get free publicity.

[+] sebyddd|9 years ago|reply
Appreciate your point of view. First of all, there seems to be a lot of skepticism around this project and I found that surprising. You're saying that if you would get incredible returns from trading you would keep quiet. And therefore you are contradicting yourself by accusing my lack of transparency.

As I was invited to share my story on Indie Hackers, my goal was to provide as much insights into the project, without blowing up the advantage it gives me over a very niche market (NSE). I have absolutely no intention to 'advertise my freelancer business' or 'sell my tech', as someone mentioned. My goal was strictly to send an encouragement message to people thinking of/building something similar, by sharing as much as I can of my project. Faking stories online would be the last thing on my agenda and I find it somehow amusing that some people believe that.

PS: Having to cat a lot of text + csv files while developing this, it was much easier to alias my cat function to use csvtool on csv files and it's regular implementation on other files

PS2: The 'minimalist, ultra-stylish AWS window' is a quick app I cranked in a few hours to see the status of my instances. Not sure what's suspicious here. The window or the the fact that it's stylish?

[+] joemi|9 years ago|reply
Not arguing at all about being skeptical, but regarding 'cat' it's entirely possible they just had the wrong file extension on that ascii art chart. I've definitely given some plaintext files incorrect extensions if I knew I'd be wanting to open them (or quicklook them) in some program that usually ignores the correct extension.

The general vagueness of the post is a much much much stronger reason to be skeptical, imo.

[+] brilliantcode|9 years ago|reply
I also felt like this article was very strange, almost too good to be true, not really discussing downside risks associated with each position.

It's possible to generate a highly profitable and successful trading system but it's the expected probability factoring in the worst case downside scenarios that really matters.

After all, you could win 9 out of 10 times but that 1 time is where you blow up.

Right now, I'm putting my wall street hat on and calling this bullshit. A naive software developer will not be able to see the potential pitfall of holy grail systems-they do not exist.

I also question if it's really HFT, the bar is really high to get low latency connection but he's only making 3.5k/month...it just doesn't make sense.

And why would you publish your system and say oops I can't tell you anything about it?

[+] alva|9 years ago|reply
Reposting my comment on the first HN submission of this page

"The claims made in this interview are extremely suspect, it just not make sense. Absolutely no relevant details are included. The developer claims he was able to built an AI trading strategy that is profitable 95% of the time. No technical details about the strategy or platform for trading is provided. A few trading buzzwords thrown in a few places. The rest of the interview is platitudes and inspirational hacker talk

I think IndieHackers needs to investigate the claims and be provided proof, otherwise this appears to be a fake project for the developer's own publicity. If IndieHackers are fine with that, I will stop visiting as I cannot trust that the content is not just shallow, exaggerated claims to raise peoples profiles."

After expressing my concerns directly to IndieHackers, the interview was changed in multiple places to flesh out a number of the spurious claims which I had criticised.

Without further details or some proof from the developer, this piece stinks. Taking into account the rest of the interview which contains stereotypical inspirational hacker talk, the whole thing feels like a badly done promotional bit for SV style status.

If I am wrong, I will apologise and the developer is going to be a multimillionaire very, very quickly. Until there is more details, I am going to be totally sceptical of IndieHacker interviews going forward. Which is a shame as I think IndieHackers is a great site. How can I trust that the other submissions are not baseless, PR pieces?

[+] morgante|9 years ago|reply
The biggest red flag is that this guy is supposedly still freelancing.

If he had a strategy this good, he would've quit freelancing and be a multimillionaire by now.

The only reason I'm not 100% convinced this is fraud is that it's on the Indian market. I don't know the level of sophistication there, so it might still be possible for an independent trader to exploit winning strategies.

[+] brilliantcode|9 years ago|reply
You fucking nailed it.

Articles like this where proper due diligence verifying the authenticity of the poster isn't in place raises strong questions about how reliable and factual IndieHacker is.

I really feel like they fucked up by posting this article. The other article seemed alright but now I ask the same questions.

[+] ucaetano|9 years ago|reply
Do you have a link to the original version? It looks fake enough as it is, I wonder how much bad it could be.

But hey, maybe this guy really cracked the market, and a Nobel prize and billions of USDs are on the way...

[+] svantana|9 years ago|reply
Agree 100% (see my top level comment for more incriminating evidence) and while this is the worst one yet, I feel earlier indiehacker articles have had similar problems -- exaggerating success and achievements for personal gain. If indiehacker wants to save their reputation, they need to editorialize more IMHO.
[+] kyleschiller|9 years ago|reply
Publication bias is a gigantic problem for amateur FinTech.

How many hundreds of engineers tried the same thing and won't get an article on the front page of HN because no one wants to read about mediocre performance? I don't want to sound too skeptical, quantitative HFT is absolutely the future, but if enough people try something that's effectively gambling, some of them are bound to succeed, and those people will get dramatically disproportionate exposure.

EDIT: I do still like this post and the project, the infrastructure is great and it offers insight into something I'm sure many people are curious about.

[+] danvoell|9 years ago|reply
It's ok Kyle, I'm with ya. I like most indiehackers articles but this one didn't really provide the same level of insight as most. I made over 150% returns on bitcoin in the last 13 months.... and I did nothing.
[+] sebyddd|9 years ago|reply
While I do agree with you to some extent, as opposed to gambling, stock market requires technical knowledge. I strongly believe that individual traders stand no chance agains the big players and there may be a combination of luck + favorable stock picks in this case.
[+] digler999|9 years ago|reply
> How many hundreds of engineers tried the same thing

And you bet your ass if I tried and succeeded I'm not going to come here and brag about it, risking whatever ephemeral edge I had. If I did this, I would do it for dollars, not karma points.

[+] minimaxir|9 years ago|reply
Votes on this submission may be manipulated with an attempt to bypass the voting ring detector via linking to /newest: http://i.imgur.com/08pAFOw.jpg

And another one by Indiehackers founder csallen after it already hit the front page: http://i.imgur.com/rxWtsWJ.jpg

[+] wnm|9 years ago|reply
Can you maybe clearly specify what exactly he did wrong? Not trying to defend him. I just want to know how to behave correctly when submitting my own stuff.

e.g:

Can we tweet a link to our own submission? Can we add a link to the end of a blog post (that we submitted ourselves) with a link to the submission, saying: "Discuss on HackerNews"

[+] canistr|9 years ago|reply
Isn't it more customary in the financial world to put out your Sharpe Ratio or ROI as a percentage as opposed to your monthly profit? As others have said, the profit doesn't mean anything if your principal amount is high.
[+] raharley0|9 years ago|reply
Do you think testing for 4 months proves your bot is better than the hundreds of serious players that spend millions on the smartest talent and the best tech tying to eek out an edge?

How are you determining true alpha? We're in a bull market. Don't mean to sound harsh but this could be blind luck.

[+] sebyddd|9 years ago|reply
Absolutely not. As I mentioned in the interview, the progress so far is not by any means a reliable metric and there are many factors that affected it. 4 months is not nearly enough to prove that and so far the bot works well on a very specific niche market. While there may be infinite other better approaches, this is yet another working one, which doesn't necessarily yield the best possible result. I understand your point of view and I completely agree with it.
[+] hmate9|9 years ago|reply
I do not wish to be negative, I just think it is very hard to really judge this system without knowing the technical details behind it. Since we are currently in a bull market it could just be a fluke.

I did not read anything about backtesting. Have you done that? If so, I take it back :)

[+] brianwawok|9 years ago|reply
Backtesting does not mean much. It's easy to make an algo do well yesterday. Very hard to make it do well tomorrow.
[+] sebyddd|9 years ago|reply
Completely agree with you. The amount of backtesting has been very limited and the time frame was pretty short, so there are definitely changes this is a fluke. Confirming this is my main goal at the moment and I don't take any credit for creating something revolutionary.
[+] morgante|9 years ago|reply
Can I do an Indie Hackers interview about how I went to Vegas a few times and made $10k? I even have some Python scripts modeling my "strategies!"

This is almost certainly a fluke, if it's true at all. There aren't any valuable lessons here and such a story merits a high degree of skepticism. Algorithms which can successfully return 95% profits consistently are not wasted on freelance developers.

I usually love Indie Hackers, but including this story really devalues the brand.

[+] csallen|9 years ago|reply
I find these criticisms quite unfair, especially given that he admits in the article that (a) he is new to trading, (b) his results cover a short period of time in a bull market and could easily be 100% luck at this point, and (c) he's had to manually step in to avoid ruin. You're excoriating Sebastian for not hedging claims that he has repeatedly hedged.

I also disagree that there aren't any valuable or inspiring lessons for indie hackers here. In fact, I enumerated some of them as asides in the interview itself, none of which would apply to your hypothetical trip to Vegas.

You and others are hyper-focused on the irrelevant question of whether or not Sebastian's attempt to build an unparalleled money-making machine has succeeded (answer: obviously not), and ignoring the actual point of the interview. It's the equivalent of the guy who read the SubmitHub interview a few months back, ignored all the lessons within, and instead attempted to create an exact clone of the SubmitHub product.

[+] RomanPushkin|9 years ago|reply
Sounds like a fake story: not too much facts, no neural net details, no links to public profile where all the trading happens.

I was trading stocks, it's really easy to fake even videos. You don't even need to fake it - just record everything and publish only successful deals.

If this story is true, it should be confirmed. Otherwise, the article can't be considered as serious.

[+] sebyddd|9 years ago|reply
Hey! The maker here. Would be happy to answer your questions on my little side project.
[+] pigs|9 years ago|reply
Are you willing to say how much money was at risk?
[+] jetti|9 years ago|reply
Have you thought about trying to trade on IEX? It could level the playing field by sidelining HFT
[+] meow_mix|9 years ago|reply
"Proprietary" technical details? He doesn't even cite the kind of network he's using. This is an ad for him as a freelancer (I doubt the ad revenue hurts him either).
[+] almoehi|9 years ago|reply
Can you say something about the software stack you used to build this? Are you using any of the existing libs like zipline or completely from scratch !
[+] sebyddd|9 years ago|reply
I do rely on Zipline heavily + other deep learning libraries. I see no point in reinventing the wheel. The stack is mainly Python and C++.
[+] dollar|9 years ago|reply
I wonder how many engineers have replicated the payoff of a dynamically hedged short option without understanding that was what was happening.
[+] csallen|9 years ago|reply
You should explain for those of us who know little about finance but are curious!
[+] alva|9 years ago|reply
What regulatory issues do you face trading with the Indian Stock Exchange when based in the US?

Also you mention you had some concern that some of the stocks may crash. Have you worked in finance in the past to be familiar with the securities offered by the NSE, BSE and MCX?

[+] sebyddd|9 years ago|reply
No regulatory issues whatsover. Zerodha, the company behind Kite is SEBI registered, therefore standard regulations apply for NSE and the others.

Have not worked directly in finance, but I always had an interest in it. However I accumulated most of my experience in the past year. My recent concerns concerns were based on previously observed patterns and analytical observation.

[+] sputknick|9 years ago|reply
How much of motivation would you say is profit versus the challenge of the game?
[+] billconan|9 years ago|reply
What api is available to get realtime stock data?

And what api can be used for trading?

Are they expensive?

[+] ddlutz|9 years ago|reply
I'm fairly certain this is in the article: For trading I recommend Kite, mainly for their stable Connect APIs and the low bandwidth. Their limitation is 3 requests per second, and this was more than enough for my new strategy. Getting solid historical financial data isn't cheap, and with so many people hitting the providers to scrape and download data, I don't blame them for limiting the offered information. Intrinio is a good provider for real-time stock quotes at very inexpensive prices. However, getting access to more in-depth data would always yield better results.
[+] sebyddd|9 years ago|reply
I talked about it in the interview. For this first version I used Kite for trading and mostly Intrinio for financial data. Costs vary from provider to provider, but for testing this, I went with some of the least expensive ones.
[+] raincom|9 years ago|reply
Does your bot day trade or swing/pattern trade?
[+] omarforgotpwd|9 years ago|reply
Sure, easy to make $3500 / month when the market is on a crazy bull run. Let's see how it does when the market crashes!
[+] sebyddd|9 years ago|reply
I am pretty sure that when that happens, the majority of stock players lose, not only my little side project.
[+] vorotato|9 years ago|reply
If it has overfitting problems it'll lose money even faster!
[+] _jgvg|9 years ago|reply
Sorry, but the little content available on the page, the Amazon ads and the very short run time makes my BS detector sound like an air-raid alarm.

Do you have anything beyond "I'm making $3.5k using methods I won't disclose on an initial investment that I won't disclose"? What's your return on your investment? Sharpe Ratio? If you apply your investment criteria in historical data, do you beat the market?

How different is it from the guy who invested his tuition money on Tesla?

[+] perteraul|9 years ago|reply
If you had created something that works for you, would you sell out all the details by spreading it on a public blog?