4 ms·
I use the Interactive Brokers MCP pretty heavily. I don't do any cool automatic fun "trading", but instead I use it to have "pseudo-QQQ". I didn't like the rel
by tombert 4mo ago
I use the Interactive Brokers MCP pretty heavily. I don't do any cool automatic fun "trading", but instead I use it to have "pseudo-QQQ".
I didn't like the relatively high fees for QQQ, and I realized that Invesco releases the weights for QQQ for free. I also think Tesla is too overvalued, and I want to avoid the SpaceX IPO. With the Interactive Brokers MCP, I just feed it the CSV of QQQ's weights, tell it to remove and redistribute Tesla, and then I tell it to buy "$1000 of pseudo-QQQ", in the form of raw stocks.
Doing this, I still basically get the same exposure as QQQ, without any fees.
EDIT: Some of the responses here were right; this is a actually a bad idea, at least with the naive way I was describing it. There's a lot more tax stuff that you avoid with ETFs compared to the makeshift thing I'm describing.
- xiaoyu2006 4mo agoThis is fair use, but an average person will just spam LLM with "give me money making strat"....
- klodolph 4mo agoQQQ gets the leverage from, among other things, swap agreements and futures. I don’t think what you have could be reasonably considered “pseudo-QQQ”. It’s like copying a cake recipe, but leaving out the flour and eggs because they are too expensive.
- tombert 4mo agoEven given that, I don't see any reason I couldn't also just mimic what QQQ does with the MCP.
- klodolph 4mo agoReal question, where are you going to buy the swap agreements?
- tombert 4mo agoIf you're asking about the average person, no. I am in the "false confidence" stage of Dunning Kruger Syndrome for finance stuff, so I personally would do swap agreements, but I'm not an average case.
- klodolph 4mo agoI realize I might have been mixing up QQQ with ultra pro QQQ… anyway, yeah, you can replicate QQQ. I was thinking of Ultra Pro QQQ.
- tombert 4mo agoI mean, even still, my point stays the same; if you have access to their strategies, I don't see why you can't just get the MCP to directly mimic that.
- klodolph 4mo agoBecause it is not possible for you (personally) to buy the underlying components of leveraged ETFs.
- tombert 4mo agoYeah, actually I think I was getting confused on some of the terminology. It looks like you're right. Still, as you said, just mimicking regular QQQ is achievable.
- klodolph 4mo agoIt’s achievable. It’s called “direct indexing”, and there are some extra costs associated with it, so for most investors, I think it is cheaper to get QQQ. You can flip that around with tax loss harvesting but I don’t understand that strategy and I can’t explain it. You also don’t need AI to do this. Before AI, the main barrier to direct indexing was the amount of capital you need. That is still true.
- deleted 4mo ago[deleted]
- piperswe 4mo agoI feel like you could probably have the AI write a script that uses the API to do the same thing, except this time you have code you can test rather than relying on the probabilistic machine every time you do a trade.
- tombert 4mo agoI did that first actually. I don't let it buy anything without confirming, and I will load the CSV into Google Sheets to make sure that the numbers more or less correspond to what I think they will. It's just easier to directly use the MCP and set up some custom skills for what I want to do. Dunno, it seems to work fine.
- WarmWash 4mo agoI have thought about this but snag on rebalancing, because it would create a taxable event, or be drawn out over months/years. Although maybe a bit spicier, VGT is half the cost of QQQ, so that is what my "NASDAQ" has been. I also blend in VTI to cut the volatility a bit, which is 1/3 the cost of VGT.
- tombert 4mo agoI'm doing the same strategy for rebalancing that QQQ does, and I figure that the headache of tax time is a "Tom in 11 months from now"'s problem :) Some tax software nowadays will allow you to simply upload the tax documents with all the transactions and it will tabulate everything for you, so I don't think it will be too hard for me. I'll admit that there's primarily just kind of a coolness factor to be able to say that I ripped off and copied QQQ without any fees, but I do genuinely like the idea that I can avoid companies that I think are terrible in the process.
- deleted 4mo ago[deleted]
- asdff 4mo agoYou don't need AI for this though. I was doing something like this with a python script and a crypto meta etf I created years ago. I even had some simple heuristics for selecting what coins and quantity to purchase given trading volume and spot price. Its like 175 lines of python. Probably could be a lot leaner too.
- tombert 4mo agoI agree I don't need it, I actually wrote a program to automatically buy and sell stuff years ago using Alpaca [1]. I just found it a bit of a pain in the ass to manage a service to do that automatically, vs thirty seconds of chatting and getting results immediately, and having something that can be supplemented by RAGs in the process. [1] I swear I had a blog post about how I did it somewhere but I seem to have misplaced it.
- asdff 4mo agoIt sounds like you are just pulling weights of qqq and buying based on that though. What more management do you have to do? Just pull and parse the weights wherever they might be stored, break the investment up based on that weight. Should work until the heat death of the universe.
- yieldcrv 4mo agoand then you want to track orders states, and then you want to track exit strategies - trailing stops that are sometimes internal, sometimes sent to the order book - profit targets, and then you want to track settlement statuses as balances change on margin, and how you get filled all while dealing with different and complex broker APIs and routing to different exchanges that have their own rules and limitations on the other hand, agents just do it and handle edge cases themselves
- asdff 4mo agoRight, AI agents famously never make any mistakes.
- Maxatar 4mo agoThis is absolutely and unfathomably terrible to such a great degree that I think it reinforces OPs point. It seems like using an LLM has given you the confidence to make an incredibly ill-informed decision that will cost you dearly. Every single time you rebalance your portfolio, you will need to pay short-term capital gains taxes on any gains, as opposed to an ETF in which you simply pay for the gains when you sell your stock which can be years/decades from now. This alone will reduce your average expected earnings by 20% over a 10 year period eviscerating whatever tiny advantage you think you'll get from saving a few bucks in fees. Furthermore, assuming you rebalance your portfolio monthly, which is the minimum you need to rebalance in order to remain even somewhat aligned with QQQ, you're basically going to be paying a MINIMUM of 30-40 bucks a month in commissions to Interactive Brokers, or 400 dollars a year. And on top of IBKR's commissions you then need to pay the pass through fees of about 5-10 dollars a month for a total of around 500 bucks a year. Compare that to QQQ which only costs you 18 dollars a year for every $10000 invested. I've read some incredibly foolish investment advise on HackerNews, but I think this one just about takes the cake.
- dumbmrblah 4mo agoBut he avoids SpaceX and Tesla, which I think is probably the driving factor in not using QQQ. Maybe he values that more than $500
- Giefo6ah 4mo agotombert should instead long QQQ and short the bits they don't like
- tombert 4mo agoYou pay interest on shorting, and it requires trying to time the market, which people are famously bad at doing.
- Maxatar 4mo agoIf that was his genuine concern, then instead of trying to balance a portfolio of 103 stocks... you simply buy QQQ and short Tesla at 3.53% worth of your QQQ holdings.
- krzyk 4mo agoQQQ?
- mandevil 4mo agoNASDAQ-100 following ETF. Until recently, the only one that tracked the NASDAQ-100, which is a tech heavy index.
- tombert 4mo agoToo late to edit my comment, but some of the responses here were right; this is a actually a bad idea, at least with the naive way I was describing it. There's a lot more tax stuff that you avoid with ETFs compared to the makeshift thing I'm describing. @dang if possible can you add this to my comment because I genuinely do not want to mislead anyone and have them repeat my mistakes.
- neonstatic 4mo agoI love how you needed an LLM to remove "passive" from "passive investing". On a more serious note, why do you need an LLM for this at all? It's an excel spreadsheet difficulty level task.