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Brent, I can't prove there is a God but I always choose to be long that
position. Being short is a drawdown that I don't ever want to face. :-)
NOW as far as random walks and systems are concerned...., I will also
place my vote that money management is the best argument to random
market behavior. My systems are nothing special and certainly aren't new
and unique however, I am profitable only because I choose good
probability situations and I have learned some order of discipline over
the years. No magic, no grail, no randomness....
Good luck convincing this group....
Duke Jones, CMT
Longboat Global Advisors, LLC
1150 N. Loop 1604 West Suite 108-486
San Antonio, Texas 78248-4503
Tel: 210-213-7813
Toll: 866-747-7711
Fax: 210-402-6332
Duke@xxxxxxxxxxxxxxxxxx
Duke.Jones@xxxxxxxxxxxxxxxxxxxxxx
-----Original Message-----
From: Brent [mailto:brente@xxxxxxxxxxxx]
Sent: Friday, January 10, 2003 3:24 PM
To: Omega List
Subject: RE: FW: Random walk
Yes I've heard all of this before. We still no definition for a proof.
That is the starting point for any scientific investigation. I don't
care who said what. Either you can define the proof or you can't.
Brent
The last paragraph of your memo clearly defined the faulty logic behind
the "random walk" hypothesis.
Just because the chart of some randomly generated numerical series may
LOOK like a chart of stock price movement doesn't mean that they both
have identical CAUSES. But you're right when you say we can imagine
anything. The theorists have.
And then they compound the problem by saying "If you believe otherwise,
prove me wrong." Which, again, is another faulty logic sequence,
because nobody can prove a negative.
The "theory" began in the business schools, not in the departments where
logic is taught. They would have laughed at the idea as one which could
only been promulgated by a freshman student from an inner city school.
One professor, with the more than appropriate initials of BM, realized
that he could make quite a reputation for himself, and not incidentially
a lot of money also, promoted the idea for his own benefit, but now,
even he, is being forced to try to "adapt" his original thesis.
What I've never been able to understand is why any one who believes this
is even remotely interested in investing their hard earned dollars.
Brent wrote:
> Hey, I've got a random trade generator built right into my software.
> It's about as successful as all other trader and trading systems are.
> Where is the 100% proof of non-random markets, or what would prove
> that they are non-random?
>
> Oh, and last I heard anyone on this list has as much right to say what
they
> want, as you do.
>
> I know that randomness can be proven. Can non-randomness be proven?
>
> If you doubt it, just tell me what the exact price of the Dow will be
> 5
days
> from today at 9:00est.
>
> Could the truth be that the markets are both random and non-random? I
guess
> that you didn't think of that.
>
> On a cloudy day you can see shapes in the clouds, like ships, faces,
flying
> saucers, etc. What ever you can imagine, and like many others you can
> read tea leaves, or see patterns on charts but until you can define
> your proof you can prove nothing.
>
> Brent
>
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