Academics Have a Poor Track Record In The Real World
Most academic types...
Have been notoriously unsuccessful in the financial markets.
One reason for this...
Is that they believe that using overly complex mathematical approaches...
Can somehow defeat their true opponents...
Who are the sophisticated market pros...
Like a CBOT floor trader or NYSE market maker...
A top Wall Street firm or a top Hedge Fund Manager.
I've been doing this for 20 years...
And you cannot use complex math...
To take money away from Market Pros...
(Or World Class Poker players for that matter).
Market pros develop shortcuts...
That closely approximate high level math...
(As do World Class Poker players).
Also...
Market pros will have a significant advantage...
Using ** real world ** risk management techiques...
Which incorporate knowledge and analysis...
Which is not easily quantified by high level mathematics.
They will crush the academic type in the long run.
(As will a World Class Poker player).
What works best is a simple rational concept...
In a very well defined market niche...
And extemely disciplined implementation with low transaction costs.
Generally...
When I read about some academics starting a hedge fund...
Using some complex mathematical approach to the markets...
I laugh...
Because they are out of their depth...
And the stock market pros will eat them for lunch.
Regards,
rm+
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