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"I've read The Economist for 20 years. Despite understanding the financial markets better than most..." outch.. "For example, you can think of the market as a
by tiatia 13y ago
"I've read The Economist for 20 years. Despite understanding the financial markets better than most..."
outch..
"For example, you can think of the market as a random walk with an upward bias."
outch again. If you think of the market as a "random walk" (a well defined mathematical concept) AND have read Taleb, you might want to read him again.
- onebaddude 13y ago>"If you think of the market as a "random walk" (a well defined mathematical concept)" Random walk with a drift is how the trend is described.
- tiatia 13y agoGreat. If you know a little tiny bit about finance then you know that stock prices are not a random walk (with drift or without). A random walk would give you a standard distribution. In reality you are dealing with a fat tail distribution.
- nandemo 13y agoIt's exactly like a random walk except that once in a while the walker gets teletransported.
- irremediable 13y agoIt's unfair of you to pick the first quote and ignore his mentioning that he worked in finance.
- wpietri 13y agoSo I should take financial advice from a random anonymous internet dude who doesn't understand quoting and can't spell "ouch"? I said, "can think of", because you can think of it that way for the purposes of the point. I needed an easy phrase to convey the short-term twitching of the market. If you have a better phrase that sets up Taleb's point, go ahead and suggest it.