are markets truly random?

The random question has been asked and answered a hundred times since I have been paying attention to this board.

The <B>random</B> question is never asked by those who made money, only those who blew up their account.

Can't we retire this foolish random question?

I bought 100 shares of CSCO in Sep of 1992. Considering splits the price I paid was 75 cents.

Thats a 36 times increase even with the Dot Com Bubble.

It aint random

:D
 
Quote from Indrionas:

A few notes on your generator:
1) you use excel's RAND() function, which generates values of uniform distribution.

2) therefore you get daily ranges from 0 to 1 which are uniformly distributed, i.e. chance of any range is equal to any other range between 0 and 1.

3) in reality, distribution of market's daily ranges are similiar to normal distribution with fat-tails
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Quote from ProfitTakgFool:

I'm sure everyone has heard of Edward Thorp, the MIT mathematics professor who beat Las Vegas at the game of black jack....he was eventually banned from Vegas. Where did he venture? Off to the stock market of course. And his method of choice? Well.....the mathematics of randomness of course. He made an absolute fortune. Just because someone has a PhD in mathematics and makes 30k per year instead of $10M per year doesn't mean the markets aren't random. They are very random and I'm glad that no one believes it.

http://en.wikipedia.org/wiki/Edward_O._Thorp
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Frankly, I think you're one of the best posters here PTF. I've learned a lot from reading your posts.

More great points from you!!:)
 
(Tapping a spoon on a half-full glass of iced tea)---

Class.....Class.....May I have your attention please?

Please pay attention to these important points:

#1 The market is random.

#2 Trading is simple.

#3 Everything works some of the time.

#4 Nothing works all of the time.

All those who believe markets are not random, please feel free to show us that #4 is wrong, and further, please tell us how it feels knowing with certainty the outcome of every trade you put on will be a winner.
 
So, BSAM, I should throw out my real-time correlation coefficient studies? Because you can't tell whether causality or random walk created a straight line? And because Z-scores are utterly worthless for the same reason? But the study is so PRETTY! I like the illusion of causality because it makes my trades seem less random. And if I thought my trades were random I would never have the nerve to put them on. Random trading with money management is such a poor alternative psychologically to the imagined confidence of causality-based trading.
 
Quote from hypostomus:

So, BSAM, I should throw out my real-time correlation coefficient studies? Because you can't tell whether causality or random walk created a straight line? And because Z-scores are utterly worthless for the same reason? But the study is so PRETTY! I like the illusion of causality because it makes my trades seem less random. And if I thought my trades were random I would never have the nerve to put them on. Random trading with money management is such a poor alternative psychologically to the imagined confidence of causality-based trading.
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You're a brave man, Hypo. You just don't know it. ;>)
 
True words of Wisdon BSAM. Excellent post!

Quote from BSAM:

(Tapping a spoon on a half-full glass of iced tea)---

Class.....Class.....May I have your attention please?

Please pay attention to these important points:

#1 The market is random.

#2 Trading is simple.

#3 Everything works some of the time.

#4 Nothing works all of the time.

All those who believe markets are not random, please feel free to show us that #4 is wrong, and further, please tell us how it feels knowing with certainty the outcome of every trade you put on will be a winner.
More...
 
Thanks tradestrong. I had the opportunity to learn on a message board similar to this when I was trying to find my way so I am more than willing to give something back.

Quote from tradestrong:

Frankly, I think you're one of the best posters here PTF. I've learned a lot from reading your posts.

More great points from you!!:)
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Spot on again BSAM. Those who trade successfully based on technical analysis simply don't know how good they are at trading randomness. They have skills that even they can't fully appreciate.

Quote from BSAM:

You're a brave man, Hypo. You just don't know it. ;>)
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