An Analogy on Efficient Markets

Efficient Markets Revisited togetherThis again? I thought we came to conclusions when we first asked Are Markets Efficient? and when we did it again with Efficient Markets Revisited (black sorcery logarithms and all). I was chatting with my wife the other day and we were on the topic of stereotypes and generalizations. I stated, matter of factly, “stereotypes and generalizations are true on a macro level, but not true on a micro level.” Someone ended up here by searching “are markets efficient and just?” That got me looking at those past posts. That got me thinking about efficient markets again. And that led me to create this wholly original analogy on efficient markets:

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Efficient Markets Revisited

Efficient Markets RevisitedHave you ever been going about your day and an idea slams you in the side of your head like a bag of rusty hammers: “I should revisit that post I wrote a month ago on market efficiency!” I didn’t think so. It doesn’t happen to me either, especially after writing a post a month ago titled Are Markets Efficient? Well not until Eytan – yes the same weirdo who emailed me lessons on advanced lottery probability – hits me up AGAIN to tell me just how wrong my math is. We decided to create a weirdo-tag-team collaboration post revisiting those graphs on market volatility. OH I bet this is going to be fun.

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Are Markets Efficient?

Are Markets Efficient?

Have you ever been going about your day and then suddenly, get hit with a revelation on The Efficient Market Hypothesis? You know, have you ever been agonized suddenly with the thought “are markets efficient?” You haven’t!? What a surprise. Well, you’re in luck. It just so happened to me and now you’ll have to sit through my pontification of the Kapitalust Interpretation of The Efficient Market in 4 Simple Graphs. What a mouthful. I bet it’s going to be fun.

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