Over the last few months, Mr Goxx has been locked in a rigged box, forced to trade cryptocurrencies, streamed live for our amusement. Whilst this may sound harsh, Mr Goxx is in fact a hamster. A hamster, who has been independently trading a portfolio of different currencies since June 12th.
You may be asking yourself, how on earth does a hamster trade? Well, the answer in this case, is a ‘Goxx Box’. By using an ‘intention wheel’ Mr Goxx selects the asset, and by virtue of a buy and sell tunnel can choose a direction for each trade.
Move aside Larry Fink, a new star manager is in town. Naturally, Mr Goxx’s performance has been impressive. Over a short, three month period since inception the portfolio was up over 24%. Whilst a starting portfolio of €390 may not sound like much, we believe that €96 easily covers his overhead (although not a Bloomberg terminal). Be-sides, who would dare com-plain when Mr Goxx outperforms Kathy Woods, Berkshire Hatha-way, the S&P 500 and Bitcoin all at once.
Jokes aside it does beg an im-portant question, once posed by Burton Gordon Malkiel (a Princeton economist). He has spent his career arguing that picking stocks is just as random as flipping a coin. The question he asks his students, is whether a blindfolded monkey throw-ing darts at a stock ticker list in the newspaper could do just as well as a human investment professional? Unless you believe that Mr Goxx has inside information or a predictive algorithm, one may have to argue that it is possible.
That being said, for every star trader like Mr Goxx one has to ask oneself, how many of his furry friends faced lacklustre returns of no note?
Perhaps, similarly to hedge funds, we only hear about the success stories! Does anyone remember Paul the Octopus who correctly pre-dicted 12 world cup matches in a row, by choosing from two boxes marked with each country’s flag? Yes. Does anyone remember Leon the Porcupine of the same zoo, who mistakenly picked Aus-tralia to win? I think not.
Hopefully the asset manage-ment space is large enough for people to follow both traditional managers and/or hamsters.