Incidentally, the EMH states that the market is sufficiently efficient that inefficiencies cannot be systematically exploited.
If you combine this with evolutionary portfolio theory, the result is that if such a strategy works for a sufficiently long time, strategies will develop that try to exploit these strategies.
So the question is, but when would you realize that the strategy is no longer working? 🤔
If you combine this with evolutionary portfolio theory, the result is that if such a strategy works for a sufficiently long time, strategies will develop that try to exploit these strategies.
So the question is, but when would you realize that the strategy is no longer working? 🤔
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9Mon
@TotallyLost Good question! Your objection often comes from the EMH: momentum cannot work in the long term because efficient markets discount the factor away.
In the article I tried to show that momentum does work and cannot be discounted away as long as people make decisions.
So if momentum is more of a fundamental view of the market, then the counter question to the EMH would be: when would it realize that B&H WeltAG no longer works?
In all honesty, the answer would have to be in both cases: When it's too late. 🤔
That's why I said: momentum or B&H - probably the biggest bet in your own financial life.
In the article I tried to show that momentum does work and cannot be discounted away as long as people make decisions.
So if momentum is more of a fundamental view of the market, then the counter question to the EMH would be: when would it realize that B&H WeltAG no longer works?
In all honesty, the answer would have to be in both cases: When it's too late. 🤔
That's why I said: momentum or B&H - probably the biggest bet in your own financial life.
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