Stock Market EV
I suppose this fits as a "Math" type question above all, and I x-posted it to the stock market forum.
How is investing in the stock market +EV? I view the following as true (please correct me if I'm wrong):
1) The market is an almost-zero-sum game. Corporate earnings influence the values of stocks (which hurt or help everyone alike), but because most stocks have phenomenally high P/E ratios, the market is essentially zero sum.
2) Because it is zero-sum, you are competing against others in a game of odds. This includes people who have inside information, and therefore have a better edge of when to buy and sell. (I figure this would be like playing poker with people who are much better than you...and the broker's fees are like a rake!)
So how can stock trading be +EV?
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