I simply mean any high that isn't broken within one's investment horizon. Just a pet peeve of mine when its suggested that buy and hold is some kind of strategy. Or that investing is always less risky than trading.
Harrytrader, Models never "answer questions". Models enable users to make predictions about the outcome of experiments. A model is considered to have merit as long as it meets this criterion. About the "(un)reality of mathematics", this is a profound philosophical question, maybe not very suited for debate on ET forums. Anybody wanting some more on this, start with Frege. Be good, nononsense
Euh be carefull when you quote It is not from me but surely from Casti who is a physician in chaos theory author of many books and who refered to market's efficiency as one of problem of paradigm in scientific approach. As far as I know making predictions is to answer questions so you're playing with words but as I said it is not me that said that . As for the unreality of mathematics if you think it has nothing to do, you're VERY VERY WRONG (emphasis for fun ) since that's just the kind of argument used by opponents of Fama - like the behavorial school or the same John L. casti above - who say that his argument is a mathematical one and that reality doesn't have to follow mathematics. Now I don't agree that efficiency is just mathematical but It would lead to far a debate since I have some econometric book that debates it on hundreds of page I will avoid you the horrible discussion that sometimes you would consider as nonsense whereas it is debates among the most eminents economists and researchers . But it is about thinking to this paradox and tried solve that I found my model. And all researchers on quantitative models always take this efficiency hypothesis as a base for thought of their model, the first one being Markotwitz of course with his portfolio theory. And that's the very reason economists won't give up efficient hypothesis since Markotwitz theory would be crashed He received his nobel prize for that remember not so long ago they won't kill him so fast .
...I haven't harrassed you for ages, mostly out of respect because I followed the URL you gave to "Laplace" and was overwhelmed by the literacy of your French. That assumes that you were indeed he, which takes some faith, as his posts were eminently well reasoned. However, my reason for posting is to assist you over time with your English, in the hope that occasionally I may prevail upon you to improve my French. The appropriate noun en anglais is "physicist", not "physician", which I can forgive since the French equivalent is "physicien". Our physicians are your medecins. However Casti may not forgive you because he is in fact a Ph.D. mathemagician, see his on line resume. All the best. - Mike P.S. - Have patience, we will work on your logic in due time.
============= Big , big difference between word difficult; and impossibility. Would want to be humble about it ; however business people , in America ,Israel have done the difficult & even what some call impossible for years. =========================== Love learning -Solomon trader king.
Now imagine that it is really possible to demonstrate market's INefficiency - also it depends on the definitions because they are CONTRADICTORY definitions - what will be the consequence . Efficiency can only exists if there is doubt. That's why I will never do this formal demonstration even if I could . Would this be comparable to driving a car that hadn't been tuned up recently? You know, uses more gas and oil, making the trip to your destination last longer.
I will answer later because it can be a bit long and I'm going to bed soon I come just to post an interesting audio conference from Jean-Philippe Bouchaud - a brilliant guy since he was the winner of young researchers from IBM in 1990 and he is specialised in market's research since 1992. http://online.itp.ucsb.edu/online/bblunch/bouchaud/ (download the file here as others don't seem to work: http://online.itp.ucsb.edu/download/bblunch/bouchaud.rm) Although it is interesting as I said elsewhere (http://www.elitetrader.com/vb/showthread.php?s=&postid=350753&highlight=BOUCHAUD#post350753) "It can only simulate a FICTITIOUS market but as for making prediction for the REAL market they are far from being successful. The best they can do is to make stochastic prediction of volatility which is not market timing since a stochastic framework cannot do so - I will for example post an interesting model from Jean Philippe Bouchaud a researcher in Physical Finance, although interesting, it is far from being able to make forecast as he admitted himself. Being able to forecast tops and bottoms like my model is impossible withing a stochastic framework. As for finding a deterministic model yes it is very very very difficult in fact IMPOSSIBLE if you don't have the good paradigm."