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

To: GraceZ who wrote (8758)	12/22/2006 1:32:27 PM
From: Wyätt Gwyön	Read Replies (3) \| Respond to of 24758

what you are describing, without attribution it seems, is straight out of Nassim Taleb's book, Fooled by Randomness. he even coined the term "black swan". of course implicit in his strategy is that a black swan event will occur before his money runs out with his victory-by-a-thousand-cuts strategy. Taleb sold his hedge fund before he could really prove that it was successful. also, his strategy is implicitly dependent on volatility not contracting further, but in fact it continued an inexorable decline for years after his book was published. i think most traders would have gone bankrupt implementing his strategy--it wasn't the best timing for the volatility-must-rise argument (today may be better timing). in short, it seems the most remunerative thing Taleb did was not to implement his strategy, but to brand it with the catchy "black swan" moniker, and to market it in the form of a meandering and pompous book. i think Taleb made some good points, but his interpretation was rather too stiff and dogmatic for my taste. he may have been more nuanced in his private thoughts as he apparently put his money in T-bills instead of rolling the dice on his fund. this article is a good summary: gladwell.com