About Alex Strashny
Hi,
This is Alex Strashny, the founder of Peaceful Gains, LLC. I want to tell you a bit about myself and about how the company and our newsletters came to be. I am grateful for being involved in this exciting and important project.
I was born in the Soviet Union. My family and I were fortunate enough to move to the United States when I was young. A couple of charities generously helped us when we had just arrived in the country, basically penniless. I was impressed by this generosity and still believe that giving even a little to someone in need can go a long way.
Education
I excelled in school from an early age, especially in math and sciences. For example, I was the head of the math team in junior high. I attended Brooklyn Tech, a public high school that specializes in engineering, math, and science. Though I was good in math and computers, I didn't want to be stuck in them — I wanted to explore other fields. So, I picked chemistry as my high school major. In both junior high and high school, I was fortunate to have several excellent teachers and good educational opportunities.
After high school, I went to the Cooper Union, a private college in New York City that gives a full-tuition scholarship to all of its students. After trying civil and chemical engineering, I decided that I didn't like either one well enough, and just got a Bachelor's in interdisciplinary engineering. This meant that I took a variety of engineering and science classes. I also decided that I wanted to learn languages, so I took French and Japanese concurrently. That turned out to be not such a great idea.
Cooper Union was founded in the 19th century by a versatile self-made man named Peter Cooper. He had donated so much of his money to the college that it offers full-tuition scholarships to all of its students in perpetuity. When I have enough money, I intend to similarly invest it in the future of humanity.
After college, I attended graduate school at the University of California in Irvine. I started out in the Ph.D. program in economics. While studying economics, I found that I was mainly interested in econometrics, which is statistics applied to the field of economics. Statistics is the mathematical science of making decisions in an uncertain world. The world is always uncertain, decisions always need to be made, and so statistics is a fundamental discipline that, in my opinion, everyone should know well. (By the way, if you are going to study statistics, I do strongly recommend Bayesian statistics. As Arnold Zellner often says, including once when I heard him speak at our university, "it pays to go Bayes".)
Because I was more interested in decision-making and not in economics per se, I've decided to switch fields once again. After three years in the Economics department, I switched out into the Institute for Mathematical Behavioral Sciences (IMBS). While there, I focused on mathematical psychology, which is just mathematical modeling and applied statistics. I was happy that I found a good academic advisor at IMBS and that I was freer to pursue my own academic interests.
Before even getting my doctorate, I took a job as a statistician with the federal government and moved to Washington, DC. I was an ABD ("all but dissertation"), which means that I had met all the requirements for a Ph.D. except that my dissertation was not yet complete. I had finally finished my dissertation and received my Ph.D. in 2007.
Learning to invest
After receiving my degree, my attention began to shift to retirement savings. Like most other federal employees, I was contributing money to our retirement savings plan, called the Thrift Savings Plan (TSP). As the amount of money I had in TSP grew, I started thinking more and more seriously about how to invest it correctly. I wanted to know exactly how much of my money should be invested in each TSP fund at all times.
I searched through at a lot of investment advice. After studying it, I typically found that the advice made little sense. At first, I thought that the investment advice that I was seeing didn't make sense simply because it was popularized and thus simplified. I thought that if I just read more "serious" articles, I would find in-depth advice that made sense.
Though I did come across good ideas that I would later build on, I did not find a specific answer to my question even in the more serious articles. However, as a result of this search, I did realize two things. First, when it comes to investment and trading advice, the old saying is true — those who know don't tell, and those who tell don't know. Second, as a Ph.D. statistician, I am highly qualified to tackle the question of investing. After all, as I wrote earlier, statistics is the mathematical science of making decisions in an uncertain world. I knew that I should be able to figure it out. And if I could not, how could the so-called financial experts, who typically have no relevant mathematical education at all?
These two realizations were very empowering. After thinking about the issues, I developed the mathematical equations necessary for choosing the optimal investment mix. I then wrote a computer program to apply these equations to financial data. I thoroughly tested the program on actual financial data to verify that it worked well.
By mid-2008, I had a first stable solution to the problem of investing. One issue with my solution was that it could only be applied to a situation with few investment choices, such as the TSP. But at that point, that's all that I was looking for.
Starting the company
That year, stocks had declined a lot. I repeatedly heard from my friends and coworkers about how they were trying to follow some popular investment advice, and yet, they were still losing their retirement savings. I saw this as a great win-win opportunity. I could genuinely help people make better investment decisions and at the same time make money for myself. I know math, statistics, and computer programming, which many other people do not. This allows me to give people useful advice that they would not otherwise receive.
To this end, I launched Peaceful Gains in October 2008. Since my method was already working with the Thrift Savings Plan, our first newsletter was Peaceful Gains TSP.
My goal with Peaceful Gains is to create the best financial advisory newsletters possible. If you have any questions or comments, please do let me know.
Best,
-Alex