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From: | "tennyson@caverock.net.nz" <tennyson@caverock.net.nz> |
Date: | Tue, 23 Mar 2004 23:23:37 +1200 |
Hi david > > Found a really great quote in the following paper: > > http://arxiv.org/abs/cond-mat/0209065 > > "Individuals with rational expectations predict others’ behavior by > focusing on their external incentives and constraints. In contrast, > individuals with adaptive expectations predict others’ behavior > (including possibly the behavior of such an abstract "other" as the > stock market) by extrapolating from the past". > > I posit that this is a fundamental definition of FA and TA? (An the > basic reason why the two approaches will never be reconciled). > No, I don't think you are quite on the right track. With *my* kind of fundamental analysis, studying the business, what ''other people' think of it and where it is going doesn't matter and should be largely ignored. I believe there is this animal called a 'fundamental trader' out there that trades on the news tickers. Perhaps what you are describing is the difference between a fundamental trader and a T/A trader. Even then not all T/A traders 'extrapolate from the past' as you put it. Some only work in the present and are 'reactive traders'. SNOOPY -- Message sent by Snoopy on Pegasus Mail version 4.02 ---------------------------------- "You can tell me I'm wrong twice, but that still only makes me wrong once." ---------------------------------------------------------------------------- To remove yourself from this list, please use the form at http://www.sharechat.co.nz/chat/forum/
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