It’s really not at all mysterious if you understand the math. Much like how evolution can miraculously create complex life by maximizing “fitness” (i.e. offspring).
Also, when you study the math, you will see the many assumptions that make the result go through. Much like evolution, it doesn’t always turn out. Markets are stupid.
I just googled to find a decent example of the math and this (pdf) is what I came up with. Looks pretty good, but there are many versions of this material available online.
I just realized I responded to a very old comment, which I was lead to by its being the parent of a comment made today. Sigh. Well, hopefully someone finds the link above useful.
It’s really not at all mysterious if you understand the math. Much like how evolution can miraculously create complex life by maximizing “fitness” (i.e. offspring).
Also, when you study the math, you will see the many assumptions that make the result go through. Much like evolution, it doesn’t always turn out. Markets are stupid.
I just googled to find a decent example of the math and this (pdf) is what I came up with. Looks pretty good, but there are many versions of this material available online.
I just realized I responded to a very old comment, which I was lead to by its being the parent of a comment made today. Sigh. Well, hopefully someone finds the link above useful.