If you torture the data long enough, it will confess.


What’s so hard about predicting stock prices? Anyone with open eyes can see patterns in stock prices—patterns that are a self-evident foretelling of whether prices are headed up or down.

Thirty years ago, a former student named Jeff called me with exciting news—my lectures on the futility of trying to discern profitable patterns in stock prices were hogwash. Jeff had taken a job with IBM and, in his spare time (ha, ha!), was studying stock prices and had found some clear patterns. He was fine-tuning his system and would soon be rich. He told me that he was going ...

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