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Biotech / Medical : Biotech Valuation
CRSP 56.68-2.4%Dec 12 9:30 AM EST
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To: hmpa who wrote (9229)9/30/2003 2:37:01 PM
From: Biomaven  Read Replies (1) of 52153
 
Interesting article - but one needs to read the original at the link you provided, not the blurb about it.

Basically this is a more sophisticated random-walk hypothesis. They get a somewhat closer match to reality than does the original Markov process model, but they still don't match exactly - for example their model admittedly doesn't have the right distribution of big price moves versus small price moves.

But just because the price moves can be simulated by random processes it doesn't mean that traders have "zero intelligence." I'd bet they'd get a very similar result if their agents used a bunch of different sophisticated rules. My basic point is that if you have a whole lot of independent intelligent agents (whether real or simulated) the net result of what they do looks pretty random.

Peter
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