Efficient market theory; Total junk still being taught to people?

Quote from buzzy2:


vladi: for your enlightment i have a PhD from a top ten university, and i have sat in classes taught by nobel prizes. as far as i know the only finance professor driving a jaguar was robert merton, but i guess he had to sell it after ltcm.
so you're giving the "Myron Scholes" treatment to the wrong person. I have several friends, PhDs too saw through all the bullshit, they also are working in "industry". We all think academics are just a bunch of pathetic self-important losers scamming, using and abusing naive starry-eyed young people. If you think your professors are rich, well you must be really poor, because you haven't seen real wealth. My condolences.
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Keep your condolences for yourself. You do have a PhD from a top ten university? Weird. Must not be in finance or economics. b/c you should know what efficiency is otherwise. And nope, at least two professors I can think of at my school do drive jaguars and are worth millions. I'd just love to give you the name of the school, but to keep my privacy and that of my research intact, I'd rather not.
You think academics are a bunch of pathetic losers? The pure academics maybe. Although they are not in it for the money, so I don't think you can call them that. Those that are doing applied stuff and making money on the side - I can't disagree with you more. Take Dreman for example. A good academician and his Dreman Asset Management is doing quite well, last time I heard...
The best academics are probably not the best teachers, b/c they care more about research and don't give a fuck about what the poor students are learning. I can see how someone who took their class would think they are pathetic losers...
I know there are some arrogant academics you describe. Trust me, I have met my share. As I mentioned before, I got a referree report from a top journal saying that the strategy is sample specific and rejecting the paper... At the time when the fund I based on it is doing superbly well (by the way, I did check it across a number of samples and that moron was just picking on the paper b/c he wanted to reject it and didn't like the fact I was showing such good profits...) Many professors at my school don't like me as much as they used to b/c they know I'm trading based on my research. but b/c there are those, you can say all are that way.
 
Quote from daniel_m:



LOL.

your somewhat admirable, but definitely misguided, superiority complex becomes clearer with every post.
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Hahaha. You keep annoying me and I'll tell you what I really think :D
Quote from daniel_m:

i am that college drop out. do u really think i'm out to "show the world" ANYTHING, let alone that markets are "inefficient"? lol. i really couldn't care less.
[/B]
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No I think you are out to get your ass kicked. Maybe not now, maybe not next year.... But when you do, I wonder if you'll feel about yourself the way you feel about STCM guys.

Quote from daniel_m:
it's a common pattern i've noticed that the more highly educated someone is the less he is willing to accept anything not taught to him by his esteemed professors as constituting "knowledge" or "skill" (and thus deride its value). vlad, i'd say you are a prime example of this unfortunate tendency. [/B]
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Example, may be. Unfortunate tendency? Don't think so.
Accept anything not taught bla bla bla. If it's something that have any real value - yeah, I'm open to new ideas. It's just that I believe that most of what the TA aspirants come up with has none and I have good reasons for it. For example? How about that amost none of them many any money, for starters?
 
I think at this point pretty much all that could have been said about what EMH is about has already been said many times. The thread is getting so long people just read the stuff and the end and raise the questions already answered.
Just posting for the fun of insulting each other is no fun. I have my beliefs and reasons for them, you have yours. everyone has a right to be wrong.
Good LUCK trading to all :D (in many respects it is luck, whether one admits it or not, why? - EMH :D)
 
wonderful debate all.

vladiator, do i understand you correctly? you're saying that if i was as smart as you are i would be making money by exploiting market inefficiencies (as you claim to do) that don't exist in the first place because the market is efficient??:)

but i am not and cannot make any money because i am not smart or sophisticated enuf to identify and exploit these market inefficiencies (that don't exist anyway because the market is efficient)?

does this mean i have to give back my profits for the last five years?

is this close? or am i way off the mark here?
 
Ok, just one quick question


Do people in general feel the market is now more or less efficient than before Reg FD?

I feel less efficient.

Thanks
 
Quote from daniel_m:



why, i do believe you've nailed it.
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dan_m, gee i really wish i was smart enuf to capitalize on these non-existent market inefficiencies (:D ) but i guess i have to settle on simple luck to make money as i must have over the last five years or so:) hope my "luck" holds out...


bet it's the same with you too. oh to be that smart( your 140 seems enuf):)
 
"Beat the Market" -- To me, that could mean to consistently pull money out of the markets. Think about this, if you could consistently pull +1 to +2 ES points out of the ES futures market per day with a minimum drawdown, you could theoretically continue to do so until your size because so big that your system reached a limit. Before that took place, though, you would probably be pulling in 7 digits a year.

Others may say that "beating the market" means getting a higher average return a year than the "average" participant.

However, let's not kid ourselves -- the market is huge. There are well over 5,000 stocks, a multitude of futures, options out the ying-yang and countless other products in which to trade. You can make money from many of these by arbing, speculating, hedging, etc. If you have inside information, you could easily beat the average return that the market provides to the average investor each year.

Whoever takes the time to learn every aspect of the market is going to be superior than the next guy. Whoever finds a way to "logically connect" all opportunities as they present themselves is going to do better than the average guy.

Efficiency is BS. Name one thing that you know of that is efficient? Nothing is perfectly efficient -- and if the market isn't perfectly efficient (and I mean PERFECTLY), then you can exploit some aspect of it.

If you don't want to bother finding out how, then get a job as a professor or teacher and teach some BS theory about the market and go to bed at night happy that you convinced yourself that a ton of money isn't available for the taking.

However, if you are SURE that the market is not totally efficient, then go out and figure out where it is rigged and break the damn code and suck the money out. How many trillions of dollars flows through the "market" each day? Learn how to dip your hand in it. I am, and it will pay off.

Markets aren't efficient. If you think they are, then you haven't bothered to learn how to become better than the next average Joe.

It is like chess. The best chess players are great because they have played the game so many times, that they see patterns and have excellent pattern recognition. They know precisely how certain patterns develop, how to respond to them and how to defend their position when threatened. Nobody, save for Kasparov or Fisher, ever played great chess out of the gate. Likewise, most (not all) traders will get their asses handed to them at first.

Is that going to stop me? Hell no. I am determined and anyone can do it. If you fail, then you didn't want it bad enough.
 
I am determined and anyone can play basketball
as well as MJ. If you fail, then you didnt want
it bad enough. :D


Truth is.... there are plenty of people out there
that dont have the IQ/emotional control/discipline/whatever
that it takes to make a trader. No matter how hard
they try, they will fail.

peace

axeman



Quote from aphexcoil:

I am determined and anyone can do it. If you fail, then you didn't want it bad enough. [/B]
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