Why did I start StockGPT?!? I answer some awkward frequently asked questions and my purpose for doing all this...

I get a lot of questions about the purpose of StockGPT, the reason behind creating it and then sharing the kind of insights that I have been. The answers are not what you'd expect... Just being open!

Over the last few weeks, I’ve had many people asking me or commenting slightly awkward things like…

• You’re just another person on the internet trying to sell me things!

• If your system is so good, why not keep it to yourself?

• If it works so well, why aren’t you a billionaire yet?

• I don’t believe you are doing this out of selflessness, you’re just trying to make money selling the same kinda things as others.

• True investing genius don’t sell products like this, they make money by actually investing themselves.

• If everyone starts using this, doesn’t it mean it will stop working?

• You’re just trying to pump and dump stocks!

In this post, I’d like to address all of these questions and share the story behind starting StockGPT.

The backstory:

I’ve always believed that when it comes to solving problems, the more people you share the problems with, the more likely you are able to come up with the solution. This was 100% the case with this product. For years, I tried to figure out the stock market purely based on my algorithmic system. While I had some success in certain market conditions, it failed frequently leading to uncomfortable losses. I knew there was an element that was missing but I just couldn’t figure out what it was for the longest time.

Then I started sharing my process with others to see if I could gain a different perspective. One day, when speaking to someone, they mentioned that the kind of stocks my algorithm was suggesting were a bit too risky and the same upside results could be achieved with less risky assets.

This led to my big “aha” moment as I realized that the entire time I was chasing after big returns with highly risky assets when I could’ve drastically reduced my risk while still being optimized for the upside. This led me to build my “Risk Score” model.

A chain of several other solutions followed this because in building the Risk Score model, I had to take into account the risk of every other stock in the market and compare each of these stocks with one another. In doing so I realized that 99% of the world (including me up until that point) evaluates stocks in isolation but the market as a whole is correlated/connected and moves relative to one another. This isolated approach is the biggest flaw in the traditional technical and fundamental analysis as each data point in those analyses is evaluated only using isolated data of that single stock. As an example, imagine the market events like the Covid crash or the 2008/2009 recession, no matter what stocks you had in your portfolio at the time, everything crashed. Therefore, no level of technical or fundamental analysis would have saved you but using the risk and the algo models, you could have frequently adjusted to be optimized for that relative market condition.

Ultimately, all these realizations led to building the algo and risk models that are relative to the data of the entire market and never done in isolation. This started to show a much greater historical outperformance compared to the benchmark indices almost giving me the sense that I have finally “Solved the Stock Market”. I know, this is a bold claim.

With that said, let’s answer the comments/questions mentioned above.

Answers to the above comments/questions:

1. You’re just another person on the internet trying to sell me things!

   1. In all honestly, I have no intention of making money from the current products and services offered. Now this doesn’t mean I never want to make money from this, the ambition is just much bigger. The truth of the matter is that I want to achieve scale for what I’m doing here. I want to put my stuff out there to attract people will “big money” that can help take this to the next level. What that could lead to is yet to be determined but here are some thoughts:

      1. My strategies would be incorporated into larger funds, investment management companies, or portfolio products like ETFs.

      2. I become my own scaled-up hedge fund charging management fees like 2%/20%.

      3. I fully productize the offering here and charge large subscription fees for a fully automated algo-based trading platform.

      4. I’m given a job at CNBC and I become the next Jim Cramer(Hopefully with a bit more hair and less annoying).

      5. I get acquired by a larger entity. They use the stuff I’ve built for themselves and turn everything off for the general public.

   2. I’m open to all the above possibilities because ultimately the payout will be significant. I’m currently charging a minuscule $30 as a way of gauging validation for the product because if I offered it for free, people wouldn’t take it seriously. As ironic as that sounds, it’s true. I may even raise the prices over time for new customers because the more expensive the product, the more serious people it’ll attract. For those that truly can’t afford the subscription cost but in some way can help me achieve my ambition or help out the community here in some way, ask me nicely and I’ll give you what you need for Free :)

2. If your system is so good, why not keep it to yourself?

   1. I could very well do that but my belief about the stock market, as well as everything else in life, is that there is abundance therefore, there is more than enough to go around. Plus, as mentioned in the above point, if I can scale this up to the level that I want, the payout would be worth it in the end.

3. If it works so well, why aren’t you a billionaire yet?

   1. Investing takes time and what I’m describing isn’t a promise of a gazillion percent return but rather a sound practice of outperforming the market consistently. Our historical data shows that outperformance can be upwards of 3X the market return but if further optimized it could be much higher. Even then, it would take years for the magic of compounding to kick in. This is why I really need to achieve scale as mentioned above. If everything goes according to plan and this scales up, which I’m confident that it will, it’s just a matter of time before I do become a billionaire :-)

4. I don’t believe you are doing this out of selflessness, you’re just trying to make money selling the same kinda things as others.

   1. I already addressed my “for-profit” related ambition with the responses above but our product is NOT at all comparable to what others are offering, what I have here is far too superior! Where else have you seen recommendations of the past getting tracked transparently to see how they are performing over time? There are countless stock gurus that recommend stocks but none provide any transparency in their track record, while we go above and beyond to provide this for shorter term as well as historically that goes back up to 30 years. Who else can provide you with a transparent track record of beating the market in a risk-adjusted manner as we can? No one!

5. True investing genius don’t sell products like this, they make money by actually investing themselves.

   1. This is absolutely true. If I wasn’t a tech guy, I would have just kept this to myself and made money the old fashion way like Warren Buffett. Now, because I’ve built this tech that can be further monetized, I’m putting it out there to attract the attention of “big money” players to help me scale things up faster than I could as an individual.

6. If everyone starts using this, doesn’t it mean it will stop working?

   1. Not really because you’ll always have people taking a counter bet. That is fundamentally how the stock market works otherwise prices would only move up and never down. Here is a famous quote to put this into perspective… “One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute.” Even when trades of legendary investors like Warren Buffett become public, the effects are generally short-lived.

7. You’re just trying to pump and dump stocks!

   1. This in the stock market is probably more rare than people would like to believe. It just takes so much money and influence to do such a thing that someone in my position isn’t capable of. If I was Elon Musk, it would certainly be possible. With that said, we are putting out an analysis on 5000 stocks and 3000 ETFs every day with no bias toward any stock. Our system naturally surfaces the top buys that usually have a market cap of 20 billion dollars plus. To pump a stock like this would require so much money that even if I wanted to do such a thing would be a foolish attempt.

Leave any other questions you may have in the comments.

Thanks,

Sohin