Amidst the latest Covid19 crisis, one thing is for sure. Most investors are going to lose a lot of money. Are there any other alternative financial investment opportunities that are sound?
Top Hedge Funds Bleeding
In recent days, Ray Dalio’s Bridgewater has seen it’s Pure Alpha Fund II declined as much as 20% for the year as of 12 Mar 2020. Jim Harris Simon’s Renaissance isn’t spared as well, as their Medallion Stocks Equity fund was seen to suffer huge losses for the year. Wall street analysts estimates that losses could easily be more than 30%.
The world’s top 10 hedge funds are all in the red. It’s not hard to figure out why. From Nasdaq’s peak of 9817.18 on 19 Feb 2020, it has dropped by 2912.59 points or almost 29.6%. The Dow Jones Industrial Average too is in a freefall, dropping from it’s peak of 29551.42 to 20188.52, a drop of 9362.90 or 31.6% of it’s total value. Trillions are wiped off the accounts of investors throughout the world.
With US having an unprecedented crisis, Donald Trump is facing an additional assault from the joint attacks from Putin and Saudi Arabia. Russia has been suppressed by the US for the longest time and now is the time for Putin to take his revenge.
A well known fact is that Shale Oil production companies were the main funders for Donald Trump’s campaign. By taking on the Shale Oil production companies, you would effectively take down Donald Trump as well. The cost price of producing Shale oil is around 50USD. By increasing production from Russia and Saudi Arabia, it would only trigger a collapse of crude oil pricing.
As I write this article, WTI Crude has already dived past the $30 USD support pricing to reach an all time low of 28.69 USD. Due to the fact that these Shale Oil companies had borrowed a lot of debt to finance the Shale Oil production activities, many of these companies would be out of business within a few months if Crude Oil price maintains at this rate.
The incentive for Saudi Arabia to joint forces with Russia is simple. They too hate being pushed around by Donald Trump. More importantly, Shale Oil companies appeared from nowhere and took a large chunk of their market share. This is also Saudi’s way of paying back to Trump’s arrogance.
Covid19 is very likely to be around for the next 9-12 months or longer. Almost 90% of unit trusts and hedge funds are all losing money. The main reason is because these are largely long term investments into stocks, bonds, equities. Most financial institutions don’t do day trade, due to their limited potential earnings and discourages day trading. However, it is the day traders that seemed to have avoided such a turmoil.
Quantitative Trading for Sports
There are only a handful of hedge funds that have diversified their investments onto Sports Trading. Unlike traditional investments, sports trading is open ended. All transactions are over within hours. In football/soccer, you get payouts after 105+ minutes (15 mins half time + injury time). There are ample liquidity for soccer and there are as much as 90 different betting options opened for a single game of soccer.
Sports Trading A.I. Fund vs Top Hedge Funds
+320% over 13 months. Average return of 24.61%.
Rest of the world: >90% of hedge funds are all in the red.
Sports Betting Are For Gamblers?
For the longest time, Sports Traders have been misunderstood as gamblers. Similar to all financial trading instruments, one needs to be able to conduct technical analysis, fundamental analysis, trading discipline and good capital management skills while keeping their emotions in check. My argument is that if Sports Betting is gambling, then any form of trading in forex, shares and options are also gambling. The best way to identify a trader vs a gambler is by the amount of work that has been put into research, prior before taking on any position.
Why Should Hedge Funds Start Looking At Sports Trading?
Every form of financial trading instrument has got it’s loophole. Most amateurs would bet on fixed odds (3 different outcomes) or handicap betting (2 different outcomes). These only give you a winning percentage of maximum 50% win rate. After deducting the spread of between 5-25% per bet, you’re in the red.
For Professional Traders, there is a betting option called Total Goals betting, where you can bet over 0.75 Goals or 0.5 goals when the half time score is 0-0. You win regardless of who scores. To most people, it is a 50/50 opportunity. However when you understand how odds are opened prematch and half time, have the necessary software and statistics to back you, your winning percentage could increase to over 85%. I would be glad to show you a glimpse of how things work. This is also how we manage to get a 320% return over 13 months.
Click here to find out more about our Sports Betting Strategies.
Edmund Ng
Chief Evangelist, CEO
Sports Trading A.I.
www.SportsTradingAI.com