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Cake day: October 6th, 2023

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  • Hedging is done in many different ways. One of the easiest, that requires zero insight is a future hedge.

    Say I hold 1000 shares worth 5 bucks each in company Bob. If the price goes up, that’s great, but I’ll need to replace my car in three years, and I’ll need at least 3000 bucks for that.

    So, I’m going to spend some money now on buying an option in 2 years 11 months to sell 1000 shares for 3 bucks per share. That way, if Bob company completely collapses, I’ll always have at minimum 3000 bucks.

    Of course, those options cost money to buy, so I’ll have to pay to reduce my risk, but I don’t need any real insight into the market to use this kind of hedge.



  • The classic non-stock example is the apple farmer. Apple trees take a long time to grow, years before they produce any significant amount of apples.

    Suppose I plant an orchard of the new Awesome Amy Apple trees. I’m betting those will really take off in two years, so they’ll be really profitable. But since these apples are my entire income, and I’d rather not eat an entirely apple-based diet by then, I’m going to hedge my investment. I’m giving up some profit to reduce my risks.

    I’m making a contract to sell half my apples for, say, 20 dollars per bucket. Now, they might be worth 40, but they might also be completely worthless if the Perfect Pete Apple becomes more popular. So I’m giving up some potential profit in exchange for certainty by hedging.

    Another type of hedge would be me planting 75% Awesome Amy, and 25% Perfect Pete. I’m still assuming the alliteration will win the day, but by spreading my investment around, I’m reducing my risk.

    To translate this to the stock market, the first examples would be to buy options for the future. The second example is simply spreading your investments.







  • I’m in the Netherlands, helping out at a station in a school gym. This station had three booths, with one low-height voting booth, both for shorter people, but also for people in wheelchairs and whatever other reason. A man in his mid-30’s comes up in a wheelchair, we check his ID, hand him a ballot and the famous red pencil, and point to the direct of the booths, where someone has the temerity of allready occupying the wheelchair booth! GASP, SHOCK!

    The guy proceeds to absolutely flip his shit, calling us bigots, racists, haters and nazis for not letting him vote from a wheelchair. That “people like us” have always hated him. For what’s it worth, note that both him and me are roughly the colour of fresh milk.

    It was super awkward, because the man was “punch-your-face” angry, and I was the only person there who was under 60… But like… he’s in a wheelchair, and I’m sure he’d hurt himself a lot more than me. I was seriously considering just wheeling him out, but he hadn’t voted yet, and assholes have rights too, and the optics aren’t exactly great on that. One of the old ladies who also volunteered told me “Don’t worry girl, we get a few like that every time, just let him go and laugh about it over dinner”.

    The kept ranting on his way out the door.



  • Despite being really really invasive here in Europe, I love the Staghorn Sumac.

    It’s very pretty, with great flowers and soft furry branches (like antlers). You can make an amazing “lemonade” from the fruits and you can eat the shoots raw.

    And eating the shoots raw is a great idea, because it branches out like crazy. If your neighbors have one of these, you’ll soon have half a dozen too.

    They also grow pretty fast, and the wood is super pretty (and super curvy, so you won’t be making any boards out of it)