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The ludic fallacy could apply here as well. If you calculate that on average you will make a profit but in actuality this profit fluctuates so wildly that you w
by cjfd 6y ago
The ludic fallacy could apply here as well. If you calculate that on average you will make a profit but in actuality this profit fluctuates so wildly that you will almost certainly go bankrupt in the process the ludic fallacy could apply.
Another criticism by Nassim Taleb to this field is the use of the normal distribution to distributions that are not normal at all. This could lead to the problem that I described in the previous paragraph.
- Ambol 6y agoAlso the fact that many market players got bailed out by governments when things went south. They may have been aware that this would happen all along, which would mean the explicit market game and the real market game are 2 very different things with very different rules.