NEHMT: Null-Efficient-Hypothesis-Markets-Testing. If an effect is real, markets will value companies that exploit it for generating profit.
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Replying to @MakerOfDecision
MakerOfDecision Retweeted MakerOfDecision
To test your hypothesis, instead of a grant proposal, you float an IPO. Also, instead of tenure, you retire early.https://twitter.com/MakerOfDecision/status/736288790646423552 …
MakerOfDecision added,
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Replying to @MakerOfDecision
Bayesians, on the other hand, buy shares in proportion to their posterior estimate. The only financial ratios they consider?
#Bayes factors.1 reply 0 retweets 1 like -
Replying to @MakerOfDecision
Funny, that. You'd think they'd sink everything into the bet with highest expected utility, but no.
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Replying to @FrameOfStack
Only if you assume no risk aversion, and zero risk of ruin. We're talking about rational investors, not idealized models.
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Replying to @MakerOfDecision
even then, the implication would seem to be Kelly-like bets, not proportional bets.
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MakerOfDecision Retweeted #TestAndTrace Smith 🐇
You're probably right on that one. I guess I'm not a optimal Bayesian. But then, who is?https://twitter.com/Noahpinion/status/733543776258424832 …
MakerOfDecision added,
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