8 ms·
Ok, I think your main idea was that since they've achieved consistently positive returns, then they're likely to keep it up. Even if that were true, the 800lb
by asdfologist 13y ago
Ok, I think your main idea was that since they've achieved consistently positive returns, then they're likely to keep it up. Even if that were true, the 800lb gorilla question is how they've managed to achieve such consistency in the first place.
- consz 13y agoThey have slightly positive return per trade, and they make millions of trades per day. Their PnL is the sum of their trades -- the expected values grows like O(n), while the volatility grows like O(sqrt(n)), so for n = several million, the probability their PnL will be negative is extraordinarily low.