You are entitled to your opinion that the most recent 4 years are proof that the GG is an invalid strategy. However, I have yet to see the results of any comprehensive study or application of the GG as promulgated in the "manual" over this period. You have yet to provide a reference to any portfolio selected in 1999 strictly according to the guidelines of the GG. I would be very interested to see one.
Surprising statement. I've been constantly referring to one mathmagician: Mike Buckley's Front Office Gorilla Game, which he started on May 25, 1998 and played according to the rules. An experiment by design. Check it out for yourself.
I am merely citing the conclusion of the experiment.
And I am not going so far as to state on the basis of one datapoint that the game is proven faulty. I am claiming that the only evidence to date supports the notion that the game is flawed! There is a difference, and I invite you to draw your own conclusion.
This was my initial criticism of Mike Buckley's post defending the game and claiming great returns from Siebel. I referred back to the Gorilla Game that contained the Gorilla and while the Gorilla itself showed good returns over the period, the returns from the game as played by the rules were less spectacular.
I realize that a sample set of one is quite small.
By the same token however, by noticing that there has been no study, you should also have concluded that there is absolutely no evidence to support the notion that the Gorilla Game works either! Despite the number of people acting as though it should work. Indeed, the proponderence of available evidence, scant though it may be, is such that if you are worried about folk acting on the basis of untested opinions in either direction then you should be criticizing anyone you find who supports the Gorilla Game!
Also please note that I didn't just start making my observation now that it's obvious that the Front Office Gorilla Game is in the dumpster. I suggested this flaw several years ago back when the only evidence was running against it. Back then it was slightly easier for folks to guffaw and invite me to read 10,000 posts before I opened my mouth again about such foolishness on this thread of learned Gorilla Gamers.
No, the last 4 years were not normal conditions. But what was going on? The "bubble" was confined to NASD tech stocks. Banks and "old economy" stuff were actually depressed due to capital reallocation. While the actual reasons are likely never to be unearthed, we saw the effect of positive feedback injected into tech stock prices in an astounding way.
And while the last 4 years were not exactly "normal market conditions", we can pretty much say the same about the period since October '87 which marks the longest running bull market in history.
As far as the '99 GKI being profitable? Well, again, go back to selection bias. The list was populated in April and May by folks looking for stocks that were shooting up in price. The prices however were set as of Jan 1 '99. If you go back and adjust the prices of these stocks to the date at which they were included in the list... well, there's a lot less green on the board.
I'm not trying to say that Gorillas aren't profitable investments. I'm just making the point that the Gorilla Game isn't obviously worth playing. Despite claims by others to the contrary. And it's not me who's arguing without evidence in support. So please, don't go there. |
