I’ve never been a strict EMH believer. My definition is that you can’t find any free money anywhere. The market does obviously stupid things sometimes—see gamestop or amc recently. You can say what you want, but in my mind at least one of the meme stocks was for all intents and purposes objectively overvalued. But my definition is revealed by the state of the world currently—I am not rich because I saw something that was, in my mind, clearly wrong. See, even when GME was at it’s highs, the cost to borrow was over 100%, with the possibility of a squeeze going even higher and thus a margin call. Buying puts at 600 IV, yeah sure. The thing was, everyone recognized that it was too high, but the cost to realize that made it such that you were essentially indifferent. And that’s what markets being efficient means to me. It’s not that it’s always right, it’s often wrong. But it’s really hard to be lesswrong than the market.
I’ve never been a strict EMH believer. My definition is that you can’t find any free money anywhere. The market does obviously stupid things sometimes—see gamestop or amc recently. You can say what you want, but in my mind at least one of the meme stocks was for all intents and purposes objectively overvalued. But my definition is revealed by the state of the world currently—I am not rich because I saw something that was, in my mind, clearly wrong. See, even when GME was at it’s highs, the cost to borrow was over 100%, with the possibility of a squeeze going even higher and thus a margin call. Buying puts at 600 IV, yeah sure. The thing was, everyone recognized that it was too high, but the cost to realize that made it such that you were essentially indifferent. And that’s what markets being efficient means to me. It’s not that it’s always right, it’s often wrong. But it’s really hard to be lesswrong than the market.