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Hi,
I was speaking only of absolute proof and it solely belongs in the
realm of physical law or mathematical theorem, not statistics.
Regards,
Pal
--- In amibroker@xxxxxxxxxxxxxxx, "Al Venosa" <advenosa@xxxx> wrote:
> Pal,
>
> Sorry, but I have to take the side of MarkF2 on this one. Yes, I
agree, you can prove anything you want with statistics, but only if
you use it improperly, which most people who have a vested interest
in something or are not objective in their analysis of an empirical
observation do (understand, I am not accusing you of anything; I'm
just stating a fact). If you use inferential, parametric statistics
on data that are not even close to being normally distributed, you
can prove anything. But your proof is flawed because you have misused
a basic underlying assumption that the particular statistical test
was designed to indicate. You speak of proof being only in the realm
of physical law or mathematical theorem. Perhaps true if you speak of
absolute proof. However, in statistics, all 'proofs' are based on
measurement error, and there is nothing on this planet that can be
measured error-free (except mathematical principles such as the area
of a triangle or the Pythagorean Theorem). In trading, the errors are
huge, sometimes infinite, because price behavior is so variable; so
in order to try to 'prove' anything statistically, you have to
minimize that error as much as possible. How does one minimize error
when prices are determined by such a huge universe of human beings,
all with different outlooks on future behavior and all biased to some
degree by their own non-objective views? You can't. You can only
generate probabilities and confidence based on those probabilities,
and that is the heart of statistical analysis. So, statistics is not
meaningless at all and in fact is a very valuable tool in this
complicated trading business of ours. Use it properly, and you will
be rewarded. Use in unwisely, and you will lose big.
>
> Al Venosa
> ----- Original Message -----
> From: palsanand
> To: amibroker@xxxxxxxxxxxxxxx
> Sent: Sunday, October 26, 2003 3:41 PM
> Subject: [amibroker] Re: solving the prediction problem
>
>
> I do not dispute the usefulness of statistics, only in the use of
it
> to prove something, which anybody who has a good grasp of
statistics
> in this planet knows, which apparently you don't.
>
> Regards,
>
> Pal
> --- In amibroker@xxxxxxxxxxxxxxx, "MarkF2" <feierstein@xxxx>
wrote:
> > What planet are you from? Statistics *is* a branch of applied
> > mathematics and, IMHO, the single most useful for trading.
> >
> > "Each of us has been doing statistics all his life, in the
sense
> that
> > each of us has been busily reaching conclusions based on
empirical
> > observations ever since birth." -- William Kruskal
> >
> > --- In amibroker@xxxxxxxxxxxxxxx, "palsanand" <palsanand@xxxx>
> wrote:
> >
> > > Like I said earlier, Statistics is meaningless in the context
> that
> > > you can come out with statistics to disprove anything. Proof
> > > requires a law or a theorem. Only Mathematics can prove or
> > disprove
> > > and that is one reason it is the greatest of all sciences.
>
>
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