4 ms·
> it's a negative-sum game This is a misconception often touted by those who think they know something. The other side of a trade doesn't necessarily win/lose
by luxpir 8y ago
> it's a negative-sum game
This is a misconception often touted by those who think they know something.
The other side of a trade doesn't necessarily win/lose if they needed to exchange $xxxm to open a factory on another continent. Not all market activity is speculation/investment. Much of it, some say the majority, is random business activity. This skews the game theory analogy enough to make it invalid. There is enough inefficiency, noise and long term trending for a non-naive participant to profit from speculation. For now.
Kudos on the word gimcrackery.
- wpietri 8y agoHi. I have written financial trading software for market makers and have worked for more than one commercial bank, so I'm reasonably familiar with the topic. I did not say that all trading activity is negative-sum. I am specifically speaking about this, which is targeted at short-term trading in cryptocurrencies. Nobody is using this to open their first European facility. This is for rubes to try to outsmart people.