It's a shame that we can't move past this attitude on HN. Sure, it might be a difficult problem, but we learn nothing from "be afraid unless you are willing to be a full-time gambler."
What made these academics think they could beat the pros?
They had concrete and plausible answers for "What do you know that the pros do not?", and were willing to test the correctness of their answers scientifically. And they have the resources to fund those tests without risking their personal financial health.
I'd give the same answer for someone who wanted to write crypto, and I'd expect much of HN to do the same. We absolutely need more people writing crypto, including crypto for fun. And the existing crypto written by "experts" is often ridiculously insecure. Please, do spend a weekend reading some book and putting together some crypto code to learn how things work. But do not proceed to encrypt your bank account credentials with them and stick the encrypted file on the public internet.
What's the ratio of amateurs who fail to the Simmons' of the world?
Not to mention the fact that there is a huge number of professionals in this space who can only afford to do what they do because it's their losing their customers money and not their own.
I'm sorry. We are simply trying to have an intelligent discussion about inventing in stock markets. No one said that you had to be as successful as Simmons or make it your full time job. The problem I'm addressing is the complete lack substance in the discussion. "Be afraid and leave all investing to the professionals. It's gambling, etc"
My response was to demonstrate that someone was making up his answer. Now you're digressing into the "well, most people fail" argument.
This might be a more intelligent discussion if you focus on the substance of the answer instead of the behavior of the participants. I admit that I was, technically, "making up" the answer, in that I did not have direct confirmation. It is rather like, if you asked me what the color of the sky is on a cloudless day in Barcelona, I'll "make up" the answer, having never been to Barcelona. But I know how skies work, and I know there's only one possible answer. And, as it turned out from the link you provided, I gave the correct answer.
If you dig into the answer in the link you provided, Simons says gained his initial funding (as well as his data) by what we could accurately call gambling. He had no strategy, no reason to believe he was successful, and no expectation of being successful. He was - through luck - successful. With that success, and having gained money he could then afford to lose, he noticed some structure in the data, and hired some mathematicians to evaluate his hypotheses. It was in fact more likely that he would have lost all his gambled money before even thinking about approaching the problem technically.
He was lucky, in the most straightforward sense. Anyone else, too, could be lucky. But the nature of probability is that the common case is not the lucky case. That's not a digression, that's the exact discussion at hand. If you want to insist that occasionally people are lucky -- sure, and occasionally a newcomer will invent a secure block cipher.
If you have enough money to test hypotheses, and you're okay with losing that money if your hypotheses are wrong, fantastic, go test them. That's exactly what Simons did. If you want to get rich by investing in the stock market without a strategy and hoping to get lucky, well, yes, some people get lucky. Simons happened to be one of them. But that's hardly evidence you should emulate that part of his behavior.
I've already watched the video. How do you think I knew where to quickly find the answer. You aren't lucky if you make those returns for 20 years. He charged 5 and 20 and people still invested.
Also, no one said the goal here wanted to get rich. Learning more about the math, etc would be interesting. Please don't tell us what's in the video again.
I can't watch the video right now, but assuming the transcript accurately transcribes what was said then:
JS: I did it by assembling a wonderful group of people. When I started doing trading, I had gotten a little tired of mathematics. I was in my late 30s, I had a little money. I started trading and it went very well. I made quite a lot of money with pure luck. I mean, I think it was pure luck. It certainly wasn't mathematical modeling. But in looking at the data, after a while I realized: it looks like there's some structure here. And I hired a few mathematicians, and we started making some models -- just the kind of thing we did back at IDA [Institute for Defense Analyses]. You design an algorithm, you test it out on a computer. Does it work? Doesn't it work? And so on.
That's basically what I said. I didn't claim that he had a brilliant and correct answer before he started. (Nor am I claiming that you need to have a brilliant and correct plan for a cryptosystem before you start.) I'm claiming that he had the resources to make experimentation not ruinous (the first part of that story is how he acquired those resources, namely, "pure luck" which "certainly wasn't mathematical modeling"), and he engaged in that experimentation and took the scientific method seriously (the second part of that story).
I'd give the same answer for someone who wanted to write crypto, and I'd expect much of HN to do the same. We absolutely need more people writing crypto, including crypto for fun. And the existing crypto written by "experts" is often ridiculously insecure. Please, do spend a weekend reading some book and putting together some crypto code to learn how things work. But do not proceed to encrypt your bank account credentials with them and stick the encrypted file on the public internet.