Years ago when I was hanging out with day traders there was a heuristic they all seemed to hold. If their trading model was producing winning trades two out of three times they thought the model was good and could be used. No one ever suggested why that particular rate was the shared meme/norm—why not 4 out of 5 or 3 out of 5. I wonder if empirically (or just intuitively over time) they simply approximated the results in this post.
Or maybe just a coincidence, but generally when money is at stake I think the common practices will tend to reflect some fundamental fact of the environment.
Years ago when I was hanging out with day traders there was a heuristic they all seemed to hold. If their trading model was producing winning trades two out of three times they thought the model was good and could be used. No one ever suggested why that particular rate was the shared meme/norm—why not 4 out of 5 or 3 out of 5. I wonder if empirically (or just intuitively over time) they simply approximated the results in this post.
Or maybe just a coincidence, but generally when money is at stake I think the common practices will tend to reflect some fundamental fact of the environment.