Condor Options

Unless you just got your first ever internet connection yesterday, you already read Abnormal Returns on a daily basis. Recently, I got the chance to interview financial omnivore and expert curator Tadas Viskanta about his new book, Abnormal Returns: Winning Strategies from the Frontlines of the Investment Blogosphere. First, I want to say that I wish this book had been written when I first got interested in financial markets. It covers just about every topic that matters in investing – from diversification to fixed income to ETFs and beyond – and none that don’t. While Tadas kept the tone broad enough to appeal to many readers, one of the hidden virtues of this book is that he also draws on key academic and industry research from the last several decades, so there’s something there for experienced investors as well. For instance: do you know the arguments for and against the existence of a risk-free asset?

The first half of our interview is below, and we cover some of my favorite aspects of the book, including the risks to someone who opts out of investing altogether, the existence (or not) of the equity risk premium, the three waves of ETF launches, and the opportunity costs of different approaches to investing. Toward the end of this video, Tadas makes a great point about how taking a position using an options spread can allow you to stay in a position longer – to fruition of the key thesis – than you might otherwise be able to if you were trading the underlying asset.

One question I forgot to ask was how Tadas manages to stay on top of the firehose of information that comes his way each day. In one chapter, he talks about the idea of going on a “media diet,” which is something we could all stand to do from time to time. One of my favorite things about this book and about Tadas’s blog is that they are like nutrient-dense meal bars, giving you everything you need and only things you need, with no filler.

Abnormal Returns: Winning Strategies from the Frontlines of the Investment Blogosphere