Sublime

Markets with overconfident traders will produce extremely high trading volumes, increased volatility, strange correlations in stock prices from day to day, and below-average returns for active traders—all the things that we observe in the real world.

For these reasons, prices may pass statistical tests for randomness, but they are not themselves random (although it is plausible that their randomness is random, and that randomness is random, and so on) but rather are unpredictable on the basis of market data alone. They are, however, predictable to the extent that the predictor accurately assess

A trap many investors fall into is what I call “historians as prophets” fallacy: An overreliance on past data as a signal to future conditions in a field where innovation and change are the lifeblood of progress.

Contrarian that I am, the format for this book is intentionally unorthodox as books on investing go these days. It is not about I lail Mary passes; it's about grinding out gains quarter after quarter, year after year. My kind of investing rests on three elements: character, goals, and experience.

Trend Following with Managed Futures: The Search for Crisis Alpha (Wiley Trading, 2015), written by Alex Greyserman and Kathryn Kaminski.

absolute return.

What matters for business is not the general behavior of prices, but the price differentials between selling prices and costs (the “natural rate of interest”).