I don’t know what you mean by “inferred empirically.” If you mean “statistical inference,” there are tons of unstated assumptions that basically assume the observed object is benign or indifferent. There is work in machine learning on learning in adversarial settings, but it’s a much harder problem. Markets are super adversarial, and in addition there are incentives against publishing sensible analyses (why give away money to hostile/competing interests?)
edit: Sorry, I should say “tons of assumptions.” People state them, and it’s clear they are benign, e.g. samples are i.i.d.
How interesting! I’ve seen work on game theoretic optimal poker playing. I can only imagine how sophisticated the market versions would be. Looking forward to seeing a wikipedia page on the topic one day :)
Markets are not like Nature, they are much more adversarial.
Even if they are better modeled by game theoretic processes, surely that could still be inferred empirically?
I don’t know what you mean by “inferred empirically.” If you mean “statistical inference,” there are tons of unstated assumptions that basically assume the observed object is benign or indifferent. There is work in machine learning on learning in adversarial settings, but it’s a much harder problem. Markets are super adversarial, and in addition there are incentives against publishing sensible analyses (why give away money to hostile/competing interests?)
edit: Sorry, I should say “tons of assumptions.” People state them, and it’s clear they are benign, e.g. samples are i.i.d.
How interesting! I’ve seen work on game theoretic optimal poker playing. I can only imagine how sophisticated the market versions would be. Looking forward to seeing a wikipedia page on the topic one day :)
Poker is a game with known rules. In investing the rules are not known in the same way. Nassim Taleb calls equating the two the ludic fallacy.
Who?
Nassim Nicholas Taleb, author of the somewhat well-known book “The Black Swan”. Former (successful) trader and (not so successful) hedge fund manager.
Interesting!