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Strategies & Market Trends : ahhaha's ahs -- Ignore unavailable to you. Want to Upgrade?

To: Wayners who wrote (443)	11/3/2000 1:49:05 PM
From: Ilaine	Read Replies (4) \| Respond to of 24758

I once read an analogy which I think makes ahhaha's point much plainer - take a thousand people and let them toss a coin. The ones who toss heads get to toss again. Every time the coins are tossed, repeat the winnowing process. Eventually you'll have left the people who have tossed heads six, seven, eight times in a row or more. They will be admired for their skill in tossing coins. They will write books about their coin-tossing abilities. But it will still be simply the result of chance. They are, as Dr. A puts it, "outliers." The probability of throwing a coin and having it turn up heads is always 50-50, but there are still long streaks where you can turn heads many times in a row. You disagree, you say that you can predict the way the market will go, so you are a good trader. And you say that a few people do that very well. And Dr. A says that you are benefitting from two processes, chance and the fact that statistically, the market goes up over time. But to benefit from the second process, statistically, you'd do better buying and holding. These are, of course, statistics. Your milage obviously varies, for whatever reason, and it may indeed be skill.