Flirting with Models Scott Phillips - Finding Ugly Edges in Crypto Markets (S7E15)
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Mar 3, 2025 Scott Phillips, an independent trader specializing in crypto markets, shares his insights into navigating the volatile world of cryptocurrencies. He discusses the challenges of limited resources in traditional trading and how this spurred his shift to crypto. Scott delves into evaluating trading venues, the predictive power of Bollinger Bands, and the unique market dynamics shaped by meme coins and decentralized finance. He also emphasizes the importance of risk management and offers practical advice for new traders looking to thrive in this rapidly evolving landscape.
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From Criminal to Crypto Trader
- Scott Phillips transitioned from a "career criminal" to a retail trader after a final stint in jail.
- He found success with "loose-pants trend following" in traditional markets before pivoting to crypto.
Crypto's Size Factor
- A size factor exists in crypto where trend following works better on larger, less volatile coins like Bitcoin and Ethereum.
- Smaller coins often exhibit negative trend effects, resembling pump-and-dump schemes.
Loose Pants vs. Vol Targeting
- Loose-pants trend following systems, while simple, have inefficiencies like binary signals and unmanaged exposures.
- Volatility-targeted systems offer better risk-adjusted returns but sacrifice some convexity.