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The interesting bit to me is, “we find no evidence of learning by day trading”. This implies to me that the top earners are merely lucky, and have no special knowledge or advantages.

Insider info?

The Longer I live, the more I see people profiting off knowledge.

A personal example I see of this is in Tech. If you understand tech, you can find areas people don't understand. Those are what's worth investing or shorting.

Although if you are limited to day trades I'm not sure this is relevant.

It could also imply that they simply have related experience or skills before starting.

It's difficult to, for example, learn how to become a brain surgeon on the job.

Medicine actually involves a significant amount of learning on the job in all specialties - https://www.verywellhealth.com/types-of-doctors-residents-in...

We were taught explicitly in my (highly-ranked US) business school that stock performance is a random walk and success is luck.

I assume this means you were taught a very strong form of the efficient market hypothesis.

I believe there’s some good evidence for weak form efficient markets hypothesis in the most liquid markets, which implies you can’t make money by trading only on ‘technical signals’ in the price. This is what you might expect day traders to try to do, so in that sense it’s not a particularly surprising result this paper demonstrates.

But the consensus is, I think, that the strong form of the efficient market hypothesis might not be true in real life - being good at fundamental analysis can lead you to outperform the market.

Illiquid markets are a bit different again - you can potentially get ‘paid’ a lot more just for providing liquidity to the market there, which is different again.

This is an interesting concept to be teaching business school students.

Doesn't this amount to telling you your education is useless?

No, because running a business and stock trading are different things.

running a business is just the opposite side of the stock trading coin.

If the stocks themselves are random walks, then the underlying company performance must be random walks. If your education does indeed improve the outcomes of the business you manage and run then that would mean stock performance can be influenced by things other than luck.

Unless of course you are operating under the premise that company performance and stock performance are unrelated.

I don't know. But a business may perform predictably from the insider's point of view ans unpredictably from the outside.

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