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Reverse Law of Large Numbers
- Thread starter radha
- Start date
- Joined
- 6/5/07
- Messages
- 348
- Points
- 26
Looks very cool. It seems to imply that, while you are modeling correlation between participants, you're ultimately going to wind up with a correlation distribution, and an expected correlation, and therefore, a guess.
Who knows which way sentiment will migrate as participants begin to copy one another. I do find the idea of modeling such things fascinating, though.
Who knows which way sentiment will migrate as participants begin to copy one another. I do find the idea of modeling such things fascinating, though.
- Joined
- 6/6/08
- Messages
- 1,194
- Points
- 58
I've read about information cascades in a microeconomics book (because my micro class wasn't challenging enough, so I got curious) and all I have to say is:
o_o O_O HOLY ****.
That is an absolutely genius way of looking at things. Wow. You'd never really think of a RLLN when dealing with millions of people, yet it happens all the time, especially with CNBC giving so many newbies investment directions (ahem, Jim Cramer).
That said, I myself am an investing newbie! No money in the market (well, my mom owns tyco electronics and sysco I believe) personally since I'm only making my first money now at an actuarial internship...but I definitely see the logic behind this, and I have to say, to build a hedge fund off of this strategy? Holy ****.
o_o O_O HOLY ****.That is an absolutely genius way of looking at things. Wow. You'd never really think of a RLLN when dealing with millions of people, yet it happens all the time, especially with CNBC giving so many newbies investment directions (ahem, Jim Cramer).
That said, I myself am an investing newbie! No money in the market (well, my mom owns tyco electronics and sysco I believe) personally since I'm only making my first money now at an actuarial internship...but I definitely see the logic behind this, and I have to say, to build a hedge fund off of this strategy? Holy ****.
