For years, 100% of my capital has been invested in Ambrus and its strategies. I’ve never allocated to outside investments (not even the S&P). Starting in early 2026, I’ll be looking to deploy a small portion of my personal capital ideally 5-10% into select external projects—ideally early-stage HFT desks. One close friend of mine runs a strong HFT operation but is currently closed to outside capital (as most are). That said, I figured I’d put this out there in case anyone is actively raising. The strategy must be focused on equities and/or equity derivatives—I don’t invest in things I don’t fully understand so it’ll be hard for me to back an operation in another ecosystem. If that’s you, shoot me a dm.

Jiu Jitsu tournaments can be a really challenging experience. I perform well when it comes to competing, and I think a big part of that comes from my background in trading. I don’t really get nervous. After years of managing risk, speaking on live TV, and presenting at conferences, I feel like my cortisol, epinephrine, and dopamine levels have been completely fried. Oddly enough, that seems to work in my favor. Over the years, I’ve seen plenty of highly skilled fighters underperform, not because of a lack of talent, but because of the mental battle they’re fighting before they even step on the mat. Jiu Jitsu matches aren’t like a marathon or a casual basketball game. You’re out there alone, with your teammates, friends, and family all watching. The spotlight is directly on you in a packed venue with hundreds, sometimes thousands, of people. And if it goes badly, it can be a brutal experience. Imagine getting slammed, manhandled, and put to sleep in front of your wife and kids for something that you prepped months for. That can mentally destroy even the most stoic people. To make it worse, there are videographers and sometimes media outlets like FloGrappling recording every second. One mistake, and you could end up as the star of an embarrassing highlight clip seen around the world. Last week, @Gingfacekillah recommended a book I found really interesting: The Inner Game of Tennis. It breaks down the mental side of performance and explains how athletes often disrupt the natural connection between the mind and body by overthinking and trying too hard. It goes into detail about self 1 and self 2 and discusses actual techniques you can do to have great output in high stress performances (similar to trading). I would recommend you guys give it a read if you are into that sorta stuff.

Very soon retail brokerage platforms will have A.I interfaces that run backtests on pass through exchange data. The 60 year old boomer that can’t code will now be able to very easily test out ideas.

Brought it home. ⚔️

Deleted the tweet on tail risk hedging. We’ll put out a short paper on it with more data in a few weeks. Have a good weekend, folks.

Had this conversation with the guys on the desk today; If you sell 1% of AUM in premium on tails consistently, you’re guaranteed to blow up if you play the game long enough. That’s not a maybe, it’s inevitable. But if you buy 1% of AUM in premium on tails, there’s no guarantee you’ll get rich. Funny how those two outcomes are the extremities of one another but aren’t mirror images of each other. One path ends in certain ruin; the other, uncertain reward.

For years, we’ve heard tail risk managers make the case that a tail hedge reduces portfolio variance, allowing investors to compound returns more efficiently and ultimately achieve a higher geometric return. The claim is that allocating 1%–3% annually to a fixed-cost tail hedge improves performance compared to simply being long the S&P. Some even go as far as saying that in any 3-month, 20% drawdown in the S&P, their hedge would make the investor “whole”….meaning a 2% hedge magically offsets the losses in the remaining 98% equity allocation (S&P). Here’s the issue. Most of these claims are built on overfit data which are anchored to extreme episodes like 2008 and 2020. When you extend the lookback to a more statistically meaningful timeframe, say 70 years instead of 20, you see a very different picture. Portfolios with high bleed tail hedges often underperform portfolios that aren’t hedged at all. So we stress tested it. And we did everything possible to favor the tail hedge. We modeled it as a one touch option: zero decay until year-end. No rolling, no pricing shifts, no slippage, none of the real-world drag that comes with derivatives. We assumed perfect timing: the manager exits the hedge at the top of the vol spike, covers the entire drawdown, and re-enters the S&P at the exact low. So this is basically a 2% yearly allocation in a one touch option, that as long as the S&P drops 20% in a 3M rolling window, the manager recovers the entirety of the losses on the remaining 98% their portfolio, with their hedge. It’s pure fantasy, even for the best traders alive. And yet, we gave them that fantasy. We also ignored fees. In reality, many tail hedge strategies charge “custom solution” premiums that amount to north of 2% in annual costs, far higher than standard hedge fund fees. So here’s what we found: even under these absurdly favorable assumptions, simply holding the S&P outperformed the hedged portfolio. Does that mean tail hedging is useless? Not at all. But it does mean that most static, solutions-based tail hedges—with heavy decay and unrealistic assumptions—do more harm than good. So the next time someone says, “It doesn’t matter if the hedge loses money,” show them the math. A hedge that bleeds too much, no matter how it’s marketed, can quietly destroy a portfolio. It’s not about whether you hedge, it’s how you hedge that determines whether it adds value or just drags.

LMFAO what happened to the deal made weeks ago? Wasn’t India one of the first countries to strike a deal with the U.S.? Take notes, we are living in the real version of financial Groundhog Day.

“I feel my success comes from my love of the markets. I am not a casual trader. It is my life. I have a passion for trading. It is not merely a hobby or even a career choice for me. There is no question that this is what I am supposed to do with my life.” - Ed Seykota

It feels like /ES 6500 is inevitable. At that point I’ll be fully out of all the S&P upside deltas that were scooped back in May. There’s better R:R elsewhere, and the index should give another shot to scoop those up again into the end of Q3.