I liked the way you described your background, I feel a bit of kinship and philosophical similarity (although you seem much more pessimistic, or at least more risk averse, than me).
I did my undergrad in engineering physics, and grad studies in applied sciences fields. My work is very technical, but in an area involving almost as much â€œartâ€ as science. Several years ago I took an interest in fractal geometry. I imagine most familiar with either fractals or financial markets will be aware that one of Mandelbrotâ€™s first applications of his â€œnewâ€ field of mathematics was toward financial markets.
Anyway, a few years ago I gave a talk in my field of expertise to the local professional chapter, discussing a specific natural phenomenon (in my field of expertise obviously) where important input parameters have fractal characteristics, at least over some reasonable spatial and temporal scales. The main thrust of my talk, which I attempted to defend with live examples, was that the more we know about a specific problem (i.e. the more data we gather), the less we understand. Or more precisely, the less confident we become in our interpretations, because obtaining more data has the unexpected result of leading to greater uncertainty. This is a particular result for specific power law phenomena with very heavy tails; such phenomena may not have a calculable mean value, or rather the calculated mean (and other statistical measures) may be scale-dependent. Or in this case, dependent on (and growing with) the volume of available data.
This is an odd little paradox associated with some chaotic phenomena. Completely counterintuitive, but nonetheless (often) real.
I wonder to what degree the same can be said for investorsâ€™ performance in the markets. Is the purported trend (mentioned by somebody earlier) for investors to do worse with greater knowledge simply a natural mathematical outcome? I suspect this may be a real and important factor, but I have no way of knowing (or proving!) it.
Anyway, thanks for the discussion, my bets are set again for another year. Iâ€™ll check back in again next year probably. Cheers all!