Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
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Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
1–10 of 195 posts
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#2I'm no finance expert but doesn't this all seem way too good to be true? At first I was reading this and thinking "how is this not exactly like Bernie Madoff?"
Then they say "The Medallion fund has been closed to external capital since 1993 ... whatever profit they make, they pay out". So clearly it can't be a ponzie scheme?
Still, it seems too good to be true. If financial experts are stumped as well then that also seems like a red flag.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#3Investing is like tech, its winner take all. This is like being surprised that Google dominates search
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#4Investing is like tech, its winner take all. This is like being surprised that Google dominates search
Only it isn't like that at all.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#5Seems to me there's an obvious flaw in the efficient market hypothesis. It states that, essentially, you can find no sustainable edge because the market rapidly reacts to information. Meaning, if there is some information relevant to expected investment performance, investors will immediately act on it, extinguishing the information advantage.
But what if the opportunity is some kind of abstract pattern that doesn't make any sense to humans? You can hardly say that people would efficiently react to patterns that are entirely uninterpretable to them. So it leaves the door open for these sort of statistical artifacts - abstract side-effects or unintuitive properties of the overall system - to provide a sustainable source of alpha.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#6The nasdaq 100 leveraged x3 on a daily basis returned like 50%+ YoY during the last decade. And that’s an index. Buffet himself said he could return 50% YoY consistently with a small(ish) amount of money. (He manages like half a trillion)
there’s no reason why with $10B trading all asset classes one can’t return 70% YoY. You must note that the fund is capped, the execution costs are incredibly low and that over the last decade it returned less than 70% YoY.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#7Seems to me there's an obvious flaw in the efficient market hypothesis. It states that, essentially, you can find no sustainable edge because the market rapidly reacts to information. Meaning, if there is some information relevant to expected investment performance, investors will immediately act on it, extinguishing the information advantage. But what if the opportunity is some kind of abstract pattern that doesn't…
I think the idea is that once someone figures out how to exploit it, others will soon.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#8I'm no finance expert but doesn't this all seem way too good to be true? At first I was reading this and thinking "how is this not exactly like Bernie Madoff?" Then they say "The Medallion fund has been closed to external capital since 1993 ... whatever profit they make, they pay out". So clearly it can't be a ponzie scheme? Still, it seems too good to be true. If financial experts are stumped as well then that also…
My mind went to the same place.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#9I'm no finance expert but doesn't this all seem way too good to be true? At first I was reading this and thinking "how is this not exactly like Bernie Madoff?" Then they say "The Medallion fund has been closed to external capital since 1993 ... whatever profit they make, they pay out". So clearly it can't be a ponzie scheme? Still, it seems too good to be true. If financial experts are stumped as well then that also…
Financial experts aren’t stumped. The article found one guy who’s trying to get attention, but in general, folks are both impressed and pretty sure it’s real.
Re: Medallion Fund “Stretches Explanation to the Limit,” Professor Claims
#10The nasdaq 100 leveraged x3 on a daily basis returned like 50%+ YoY during the last decade. And that’s an index. Buffet himself said he could return 50% YoY consistently with a small(ish) amount of money. (He manages like half a trillion) there’s no reason why with $10B trading all asset classes one can’t return 70% YoY. You must note that the fund is capped, the execution costs are incredibly low and that over the l…
If it's so easy and straightforward to return 50% YoY, why aren't there a proliferation of funds doing this?