Category Archives: Entrepreneurship

What do Chinese migrant workers do after they “retire” young

Here’s something we all know: China has a large population of migrant workers, who left their villages and traditional ways of life, adventured into eastern provinces, and became factory workers or waitresses. As a whole they are pretty young, as their jobs require. When they get a little older, like 32,   a lot of them are forced to “retire” from those jobs because even younger workers pour in.

So the question is: what do those former migrant workers do after they lose their jobs? They are actually still very young, in their early 30s. Their families have been depending on their city wages. It’s hard for them to settle in the city because they don’t have city “hukou” and they can’t find stable physical jobs anymore. If they go back to villages, there are no enough agriculture work for them. Plus they don’t want to go back.

I did some research and here’s what I found:  A lot of them became Taobao Sellers. Taobao(淘宝), meaning “Searching for treasure” in Chinese, is the dominant C2C site in China, with millions of virtual shops, owned by Alibaba. It seems that a lot of these retired workers did well on Taobao too. They don’t need to speak perfect mandarin or have good local connections(which are city folks’ competitive advantage in city jobs).  Taobao provided them a great way to keep what they have today and keep progressing. The benefit is they don’t need to stay in cities to do this. They can go back to a small town and be as good a seller as someone in a big city. And that’s the right direction of urbanization.


I found myself thinking today about something surprising I learned once from a seasoned trader.  A member had asked if the trader had ever day-traded his own account.  My trading buddy and I who witnessed the exchange were surprised to learn that, not only had the trader never traded his own money; he said he didn’t think he would have the nerve to take on the risk of even doing so.  I was stunned.

I have only been day-trading for the better part of three years.  Over the last two years, it has been the primary way that I make a living…  You know, earning an income; putting food on the table, paying the bills, etc.  I don’t know why, but I just presumed that professional traders working on Wall Street  (or Englewood Cliffs)  earning big salaries, bonuses, equity opportunities, and the like, got to that level of accomplishment because they had proven track records doing what I am doing day in and day out.  But apparently that is not necessarily the case.

 I don’t mean to diminish the qualifications of professional traders, nor suggest they deserve any less regard.  I was just surprised.  And I realize that I don’t have the personal experience of the pressure that surely must come from being accountable for trading the boss’s book.  Especially if the boss can be a bit excitable.  But once in a while, on days like today when I recall that original revelation, I find myself pondering the additional psychological and emotional challenges that I face by putting my own money on the table.  I believe that it must compound the complexities of balancing risk with reward as I enter and exit trades, subtracting the commissions, and compiling profits and losses into what becomes my family’s net income.

 As my teacher points out, day trading can be The World’s Greatest Business; I get to be my own boss, choose my own hours, and work where I please (and only if I please!), deal with zero politics, and many other benefits and advantages.  But I also remind myself from time to time that when you “only get to eat what you kill,” it is important to keep your powder dry.  And it sometimes makes me wonder if the priority I have learned to give to protecting my capital is held as nearly as dearly by those who trade only Other People’s Money.

New Sizzle Reel with Jeremy Frommer in ‘Risky Money’

“Risky Money” Sizzle Reel


‘Risky Money’ Sizzle Reel


Credit Crunch…

McDonald's Arches

According to some small business owners, ‘Banks only feel comfortable lending to those who do not need the money’, and are continuing to make it even harder for those who do. Restaurant operators are still struggling to obtain financing for expansion, remodeling or upgrading unless they surfaced from the brawl of our most recent economic downturn without a scratch. For instance, McDonald’s Franchisees may find an easier time borrowing capital unlike competitors such as Burger King or Wendy’s, whose last year’s sales weren’t as valuable as those of the “Golden Arches.”

McDonald’s (MCD) Global comp store sales increased 6.5% in October, while stores such as Wendy’s (WEN) decreased almost 2%.

Although the credit crisis is not as bad as it was, and there are signs that access to credit is getting better, lenders are still unwilling to part with their money and loan to just anyone. The capital is available, however, it seems as though creditors are only open to lending to the strongest Franchisees.

As it looks now, if you’re a restaurant or franchisee owner/operator wanting some extra cash for your business, your chances of borrowing are slim unless you’re willing to part with your current business model and trade it in for a seat at Hamburger U.

building an implied vol curve…

I am at our client’s office right now working away with a group of other financial engineering students. We have been contracted somewhat to update their implied vol curve more regularly (right now they do it twice daily with a very simple-looking curve and we’re going to update it every 5 or so minutes) and it looks like we’re going to deliver. The group is relatively large; we have 8 members. So communication is paramount. To a large extent, this is my role within the group.

I handle all client interaction and act as the as the face of the group to the professor in addition to running all meetings. I am simultaneously admin and representative, contact point and scheduler, arbiter and facilitator. It is an interesting role and I am absolutely loving it.

On the entrepreneurship side, it looks like we are going to get the university channel up and running pretty soon. I just spoke with a leader of a club at Cornell that has 12 financial engineering masters students in it and they are extremely excited to get their hands dirty with some actual trading. This is where HFL comes in. The website provides the necessary forum to bat around ideas and compare thoughts. It is a training ground and an information source and the university angle is the next step in this evolution.

Hmmm…I have been charged with coming up with a current topic for discussion for class next week. Should be fun. Expect a post on whatever we come up with.


Check Out Hedge Fund LIVE’s First Press Release Ever!

Check out our first press release ever: Real-Time Broadcasts from Professional Trading Desks

NEW YORK-(BUSINESS WIRE)-Jeremy Frommer, former Managing Director and Global Head of Prime Services at RBC Capital Markets (“RBC”), today announced the launch of, his highly anticipated interactive trading community; the first ever network of transparent trading desks and an entirely new iteration of trading community.

HedgeFundLIVE members have the opportunity to observe and listen to portfolio managers and traders as they operate in real time. Multiple trading floors are linked together through an innovative audio and video infrastructure. Ideas and thoughts are communicated and acknowledged in real time in the cyber environment. As ideas evolve through this dialogue, they are executed electronically and actively traded. By combining thoughts in this controlled format, HedgeFundLIVE intends to create an advantage that is not found in the traditional proprietary trading community; one that Mr Frommer refers to as Collective Intelligence.

“The last two years has seen a massive divide between Main Street and Wall Street. My primary objective with HedgeFundLIVE was to create a transparent environment in which both groups can gain a better understanding of the other,” said Mr Frommer. “When it comes down to it, Wall Street and Main Street are mostly comprised of the same types of people, with interests aligned. These days I consider myself part of Main Street.”

HedgeFundLIVE is as much market commentary as it is classroom. “We have received overwhelming interest from the academic environment and are currently actively engaged in joint projects with over ten academic institutions,” said Co-Founder and President Alan Portnoi. With over 100 aggregate years of experience, the principal players have amassed a wealth of knowledge in the worlds of finance and Wall Street culture. The principal beneficiaries of this knowledge are the public at large and member trading desks. is a free and open site, requiring no registration process. Visitors to the site are both veteran traders as well as anyone who is in any way curious about trading and the financial markets. Through a combination of lectures, blogs and real-time viewing, visitors will improve their overall understanding, while simultaneously gaining one-of-a-kind exposure to Wall Street culture.

About Jeremy Frommer:

Jeremy Frommer has 20 years of industry experience and currently serves as Chief Executive Officer. Previously, Mr. Frommer was a Managing Director and Head of the Global Prime Services Group (“GPS”) at RBC Capital Markets (“RBC”) and was a member of the RBC Global Equities Operating Committee. Mr Frommer has held numerous Senior Executive positions at multiple institutions on Wall Street.

About Alan Portnoi:

Co-Founder and President Alan Portnoi has over 25 years of industry experience and is currently responsible for Marketing and the growth of the University Channel at HedgeFundLIVE. Previously, Mr Portnoi was a Managing Director at RBC Capital Markets (“RBC”) where he ran the US Event Driven Trading Desk.

Further announcements will soon be made regarding HedgeFundLIVE’s educational initiatives and content partners.

Starbucks and Motivation

When we were just beganing our last business I was new to the “start up” world. I had spent most of my career at Bear Stearns and Deutsche Bank, neither preparing me for what I was about to undertake. We had 7 employees, a tiny office in Fort Lee and I had to walk 2 flights of stairs to get to the men’s room. A Senior Managing Director from Bear called me and told me to “wake up and smell the coffee, there was no way our tiny firm was going to compete with the likes of Bear”. He told me I was wasting my time and I should get a “real job”. I hung up the phone more determined then ever. P.S., 4 years later we sold our “start up” to the Royal Bank of Canada. The day the deal closed I bought a coffee and walked it over to my old friend at Bear… The take away here is that if you really believe in your business you have to perservere. There will always be those that dont believe you can pull it off. You cant let them derail you…use it as motivation. I find myself in that same position today. The only difference is that my old friend who I happily bought coffee for was our first investor. That said we are going down a path no one has gone down before, a fully transparent hedge fund and broadcasts real time every day. Plenty of people are blown away at the idea….others think I should “wake up and smell the coffee”…I often think about the VC’s and Angel investors who passed on Google when they were trying to raise 2 million dollars. Plenty of smart people passed. Plenty of smart people have passed on my second start up. Hopefully I will be buying a lot coffee in a few years…..