08-10-2007, 05:06 AM
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#1 |
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Chief of Naval Operations
  
Join Date: May 2000
Location: LEVITTOWN< PA> USA
Posts: 13,621
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Algorithms Prove No Match For Market Tumble
http://techdirt.com/articles/20070809/121909.shtml
Earlier this year, famed inventor (among other things) Ray Kurzweil announced that he was getting set to launch a new investment company that would employ advanced mathematical techniques to discern patterns in the stock market. Of course, just because Kurzweil is widely considered to be a genius, it doesn't mean he'd have any midas touch when it comes to the stock market. Furthermore, quant funds, as they're known, aren't novel. Lately, in fact, they've been getting slaughtered as the market swings about in unpredictable ways. Top tier investment bank Goldman Sachs has announced that its closing one of its premier quant funds in light of recent losses. Obviously computers have become an indispensable tools in modern day investing, but no algorithm or mathematical genius can guarantee good performance in all markets. |
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08-10-2007, 06:56 AM
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#2 | |
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Rear Admiral Lower Half
 
Join Date: Jun 2002
Location: Charlotte, NC
Posts: 2,533
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Quote:
It can be another tool used in the research, but algorithims alone shouldn't be the deciding factor. Fundamentals are just part of the analysis. Add to the that the fact there is so much speculation that drives the market now and they won't be very successful in the short term. Not sure about long term though.
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It only ends once... Anything that happens before that is just progress. Courage is not the absence of fear but rather the judgment that something else is more important than fear. |
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08-10-2007, 03:59 PM
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#3 |
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Picture of the Day Guru
Join Date: Oct 2002
Location: Sunny San Diego
Posts: 8,756
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Measuring trends can work in the long run- but they are lousy at predicting short term results. Emotion is a part of investor psyche and can exagerate movements.
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08-13-2007, 01:55 PM
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#4 |
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Rear Admiral Upper Half
Join Date: Jul 2000
Location: Where the east meets the west.
Posts: 3,066
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Computers can't guess what a human will do. We are unpredictable.. Perhaps if they replaced the computers with monkeys, their success would improve.
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"The girl is crafty like ice is cold." "I left my heart in san francisco... And my liver at Moe's Tavern." A real friend is one who listens to you as much as they talk to you. |
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