4 ms·

Can you cite a source for this claim? Because everything I see suggests otherwise

godelski 3y ago
https://unusualwhales.com/politics/article/congress-trading-report-2023 https://unusualwhales.com/politics/article/congress-trading-...
- jncfhnb 3y ago
  I’m not really interested in reading this entire report. This is their first bullet > Congress beat the market, once again. Of 100 trading members, 33% beat SPY with their portfolios. This does not inspire a lot of confidence in their findings. If 33% beat the SPY, then twice as many congress members underperformed. Can you share specific claims that seem relevant?
  - godelski 3y ago
    > Can you share specific claims that seem relevant? I'll admit I'm conflicted here. On one hand, yes, I can and I'd encourage you to just start with looking at the figures since figures say a lot. There's actually not much text and most of the page is figures. But on the other hand, I think there's enough nuance to what's going on that oversimplification can result in a inappropriate dismissal of any claims. Not being a domain expert will only exacerbate any failures to communicate. Certainly the devil is in the details here. FWIW, they do have a tldr. > If 33% beat the SPY, then twice as many congress members underperformed. This being a perfect example. The former does not imply the latter. Nor would the latter imply that there wasn't foul play. First off, there is a third option: matching the SPY. Second, beating the SPY is a proxy metric which is typically used to help identify those that have performed suspiciously well, not those who performed average. It is actually difficult to beat the market, and more so to do it consistently[0]. So I must insist that you use the metric as a guide, not a filter or target. Third: There are many ways to under-perform compared to the market, including not investing. I mention that specific mechanism as one thing the report shows is that there are far fewer filings by Republicans so this is necessary context to properly evaluate some fact like "Democrats beat their Republican colleagues by a massive margin." (Dems ~= 2x Reps in transactions) We must also consider that democrats have fewer members and that >50% of each party's transactions originate from a single member of that party (Ro Khanna (D) and Michael McCaul (R)). There are also multiple vehicles for wealth generation so while stocks should be of interest, it shouldn't be used as the only evidence of manipulation and/or foul play. Fourth: consider what information is marginalized by the metrics. Pareto distribution should be expected, and it is even observed. You must therefore be considerate of aggregates as variance is high (difference between mean and median is large). But I will give you some TLDRs. The report goes into nuance because the claim of insider trading is reliant upon details: - Top 10 returns, in order are: Brian Higgins (D-NY: 239%), Mark Green (R-TN: 122%), Garret Graves (R-LA: 108%), David Rouzer (R-NC: 106%), Seth Moullton (D-MA: 80%), Ron Wyden (D-OR: 79%), John Rutherford (R-FL: 69%), Richard Blumenthal (D-CT: 68%), Nancy Pelosi (D-CA: 66%), Peter Sessions (R-TX: 63%). SPY returns ~=25%. 32 members beat SPY (50/50 split by party) (Note: Higgins holds $100k in NVDA, purchase was from 2021, no sales have been recorded) - 19 congressional members had negative returns, 13 being Republicans. - Kevin Hern (R-OK) stands the most to gain via stocks that correlate with war. 4 of the top 5 most incentivized are Republicans, the other is Pelosi in 4th. Follows power law distribution. - They have a breakdown by transactions that align with members that serve on relevant committees (this is where detail matters and stronger evidence of foul play is drawn from). I would suggest reading or at least giving a quick read rather than relying on me to accurately summarize it for you. Especially if you think there is a bias. I'm sure you can carve out 15-30 minutes if this is actually a topic you care about. If not, I might suggest ensuring your confidence in your existing model appropriately aligns with your domain expertise and time dedicated to becoming informed on the subject. [0] https://www.nytimes.com/2023/04/14/business/stock-market-2022.html https://www.nytimes.com/2023/04/14/business/stock-market-202...
    - jncfhnb 3y ago
      > This being a perfect example. The former does not imply the latter. Nor would the latter imply that there wasn't foul play. It would imply literally nothing of interest and is an absurd claim to lead with. Congress beat the market absolutely doesn’t follow from 1/3 of them beating the market. It would be strange if that number were considerably lower. > First off, there is a third option: matching the SPY. realistically only possible if there’s a healthy margin to be qualified as “beating” it. Is that considered here? Idk. I’m guessing not. > Second, beating the SPY is a proxy metric which is typically used to help identify those that have performed suspiciously well, not those who performed average. It is actually difficult to beat the market, and more so to do it consistently[0]. So I must insist that you use the metric as a guide, not a filter or target. No, that’s a stupid claim. It’s incredibly easy to beat the market in a single year by chance. Again for unqualified definitions of “beating it”. It is extremely likely that a sizeable proportion of any investing group will beat the market in a given year. You are correct about multiple successive years. > Third: There are many ways to under-perform compared to the market, including not investing. I mention that specific mechanism as one thing the report shows is that there are far fewer filings by Republicans so this is necessary context to properly evaluate some fact like "Democrats beat their Republican colleagues by a massive margin." (Dems ~= 2x Reps in transactions) We must also consider that democrats have fewer members and that >50% of each party's transactions originate from a single member of that party (Ro Khanna (D) and Michael McCaul (R)). There are also multiple vehicles for wealth generation so while stocks should be of interest, it shouldn't be used as the only evidence of manipulation and/or foul play. Incorrect. The metric being discussed only included trading members. > Fourth: consider what information is marginalized by the metrics. Pareto distribution should be expected, and it is even observed. You must therefore be considerate of aggregates as variance is high (difference between mean and median is large). I don’t care man. If less than a third are doing better than the market then there’s not a lot of evidence to suggest they’re using info to beat the market. Because they’re not beating the market on average. The total return was within a few tenths of a percent of the SPY index. It’s a dumb claim. Is there insider trading? Maybe. Idk. But regardless. Do they on average beat the market? That is definitely not supported by the data. Fee free to run a t test.
      - 3y ago

https://unusualwhales.com/politics/article/congress-trading-report-2023 https://unusualwhales.com/politics/article/congress-trading-...

jncfhnb 3y ago
I’m not really interested in reading this entire report. This is their first bullet > Congress beat the market, once again. Of 100 trading members, 33% beat SPY with their portfolios. This does not inspire a lot of confidence in their findings. If 33% beat the SPY, then twice as many congress members underperformed. Can you share specific claims that seem relevant?
- godelski 3y ago
  > Can you share specific claims that seem relevant? I'll admit I'm conflicted here. On one hand, yes, I can and I'd encourage you to just start with looking at the figures since figures say a lot. There's actually not much text and most of the page is figures. But on the other hand, I think there's enough nuance to what's going on that oversimplification can result in a inappropriate dismissal of any claims. Not being a domain expert will only exacerbate any failures to communicate. Certainly the devil is in the details here. FWIW, they do have a tldr. > If 33% beat the SPY, then twice as many congress members underperformed. This being a perfect example. The former does not imply the latter. Nor would the latter imply that there wasn't foul play. First off, there is a third option: matching the SPY. Second, beating the SPY is a proxy metric which is typically used to help identify those that have performed suspiciously well, not those who performed average. It is actually difficult to beat the market, and more so to do it consistently[0]. So I must insist that you use the metric as a guide, not a filter or target. Third: There are many ways to under-perform compared to the market, including not investing. I mention that specific mechanism as one thing the report shows is that there are far fewer filings by Republicans so this is necessary context to properly evaluate some fact like "Democrats beat their Republican colleagues by a massive margin." (Dems ~= 2x Reps in transactions) We must also consider that democrats have fewer members and that >50% of each party's transactions originate from a single member of that party (Ro Khanna (D) and Michael McCaul (R)). There are also multiple vehicles for wealth generation so while stocks should be of interest, it shouldn't be used as the only evidence of manipulation and/or foul play. Fourth: consider what information is marginalized by the metrics. Pareto distribution should be expected, and it is even observed. You must therefore be considerate of aggregates as variance is high (difference between mean and median is large). But I will give you some TLDRs. The report goes into nuance because the claim of insider trading is reliant upon details: - Top 10 returns, in order are: Brian Higgins (D-NY: 239%), Mark Green (R-TN: 122%), Garret Graves (R-LA: 108%), David Rouzer (R-NC: 106%), Seth Moullton (D-MA: 80%), Ron Wyden (D-OR: 79%), John Rutherford (R-FL: 69%), Richard Blumenthal (D-CT: 68%), Nancy Pelosi (D-CA: 66%), Peter Sessions (R-TX: 63%). SPY returns ~=25%. 32 members beat SPY (50/50 split by party) (Note: Higgins holds $100k in NVDA, purchase was from 2021, no sales have been recorded) - 19 congressional members had negative returns, 13 being Republicans. - Kevin Hern (R-OK) stands the most to gain via stocks that correlate with war. 4 of the top 5 most incentivized are Republicans, the other is Pelosi in 4th. Follows power law distribution. - They have a breakdown by transactions that align with members that serve on relevant committees (this is where detail matters and stronger evidence of foul play is drawn from). I would suggest reading or at least giving a quick read rather than relying on me to accurately summarize it for you. Especially if you think there is a bias. I'm sure you can carve out 15-30 minutes if this is actually a topic you care about. If not, I might suggest ensuring your confidence in your existing model appropriately aligns with your domain expertise and time dedicated to becoming informed on the subject. [0] https://www.nytimes.com/2023/04/14/business/stock-market-2022.html https://www.nytimes.com/2023/04/14/business/stock-market-202...
  - jncfhnb 3y ago
    > This being a perfect example. The former does not imply the latter. Nor would the latter imply that there wasn't foul play. It would imply literally nothing of interest and is an absurd claim to lead with. Congress beat the market absolutely doesn’t follow from 1/3 of them beating the market. It would be strange if that number were considerably lower. > First off, there is a third option: matching the SPY. realistically only possible if there’s a healthy margin to be qualified as “beating” it. Is that considered here? Idk. I’m guessing not. > Second, beating the SPY is a proxy metric which is typically used to help identify those that have performed suspiciously well, not those who performed average. It is actually difficult to beat the market, and more so to do it consistently[0]. So I must insist that you use the metric as a guide, not a filter or target. No, that’s a stupid claim. It’s incredibly easy to beat the market in a single year by chance. Again for unqualified definitions of “beating it”. It is extremely likely that a sizeable proportion of any investing group will beat the market in a given year. You are correct about multiple successive years. > Third: There are many ways to under-perform compared to the market, including not investing. I mention that specific mechanism as one thing the report shows is that there are far fewer filings by Republicans so this is necessary context to properly evaluate some fact like "Democrats beat their Republican colleagues by a massive margin." (Dems ~= 2x Reps in transactions) We must also consider that democrats have fewer members and that >50% of each party's transactions originate from a single member of that party (Ro Khanna (D) and Michael McCaul (R)). There are also multiple vehicles for wealth generation so while stocks should be of interest, it shouldn't be used as the only evidence of manipulation and/or foul play. Incorrect. The metric being discussed only included trading members. > Fourth: consider what information is marginalized by the metrics. Pareto distribution should be expected, and it is even observed. You must therefore be considerate of aggregates as variance is high (difference between mean and median is large). I don’t care man. If less than a third are doing better than the market then there’s not a lot of evidence to suggest they’re using info to beat the market. Because they’re not beating the market on average. The total return was within a few tenths of a percent of the SPY index. It’s a dumb claim. Is there insider trading? Maybe. Idk. But regardless. Do they on average beat the market? That is definitely not supported by the data. Fee free to run a t test.
    - 3y ago