| >At least we went from beating a fair coin with a crowd to benchmarking against a passive portfolio :) I agree it's not a perfect analogy, but the underlying point holds: there's inevitably going to be some that come out on top because of luck, rather than actually skill. >The quote just means that the winning model was overfit to leaderboard. Not that there weren't better models submitted than the baseline, for else someone submitting the baseline would have won. So the study is inconclusive at best when it comes to forward-looking results? >See, I really don't believe this. You can use the script features for longer timelines, then there is no rush. You are also not as much competing with the smart money, as you are joining them. I really don't think those few 1000s $ someone early on spends, are taking any action of the table. And the big players can't take it all. The problem is that once the information has been priced in, there isn't anything to gain anymore. For instance, let's say company A shares are selling for $100 each, and you found out that company B is planning to acquire company A at $120/share. If you found out this information before anyone else and traded on it, you can make a profit of $20/share (ignoring using leverage or derivatives). However, if you were late to the party, ie. found out this information after others did, and the price already rose to $120, then there's nothing to gain from it. Buying the shares at $120 and then selling it at $120 doesn't net you any profit. This example uses an acquisition as a pricing event, because it provides an unambiguous price target, but this can extend to other events as well, such as finding out this quarter's earnings is above/below estimates. >but yes, would need both sophistication and time investment therein lies the problem. There's no free lunch here. You can't blindly apply the rule and get stacks of cash. Citing "countertrend" in this case is only marginally more helpful than citing "buy low sell high". >[Insert fact about how those predictions cluster around the last 3 recessions] source? Here's one I found to the contrary. https://www.bloomberg.com/news/articles/2019-03-28/economist... A recent working paper by Zidong An, Joao Tovar Jalles, and Prakash Loungani discovered that of 153 recessions in 63 countries from 1992 to 2014, only five were predicted by a consensus of private-sector economists in April of the preceding year. And the economists tended to underestimate the magnitude of the slump until the year was almost over. |