Comments on: Efficient Markets Versus Adaptive Markets

By: David Merkel

David Merkel — Tue, 24 Jul 2007 20:59:57 +0000

Thanks for posting. The AMH is a useful way to think about the markets in my opinion, because it allows us to view the anomalies of the markets as investment strategies that get overdone and ignored. They have value on average, because of human foibles, but they don’t work all the time.

By: Rockett Fuel

Rockett Fuel — Tue, 17 Jul 2007 12:38:59 +0000

Got here via Unknown Professor’s site. The AMH has a promising start – it always helps to put a name to something alot of people intuitively feel! I like the illustration in the end although it sounded familiar (not just scene 1)… maybe I heard a similar version.

I do remember one of my professors saying in class something along the lines of, “[the market] might not be efficient at every point in time, but it eventually gets there… until the next new information arrives.”

By: The Unknown Professor

The Unknown Professor — Mon, 09 Jul 2007 23:33:28 +0000

Great illustration – I’ve linked to it and I’ll use it in class the next time I teach about market efficiency. Also – very nice blog – Keep up the good work. I’ll add you to my blogroll next time I update the blogroll.

By: David Merkel

David Merkel — Thu, 05 Jul 2007 15:54:59 +0000

Hope you’re having a great vacation, Barry. I appreciated your efforts to keep spammers off of your site. I have largely been successful there, but I fear that it reduces the number of comments I receive from readers. Than again, quality comments beat comment quantity, and with my readers, I am grateful for the quality.

By: Barry Ritholtz

Barry Ritholtz — Thu, 05 Jul 2007 14:09:57 +0000

“The adaptive markets hypothesis says that all of the market inefficiencies exist in a tension with the efficient markets, and that market players make the market more efficient by looking for the inefficiencies, and profiting from them until they disappear, or atleast, until they get so small that it’s not worth the search costs any more.”

That’s the money shot, right there . . .

By: amccabe

amccabe — Tue, 03 Jul 2007 17:31:10 +0000

Scene one is the best comedic illustration of the EMH I’ve ever heard. But I laugh at the “What’s the contour integral of western Europe…”