Re:Markets are efficient if and only if P=NP (2010)
by imtringued on Wednesday October 21, 2020 @05:07AM
(#24846040)
You're talking about real world markets which are obviously not efficient by theoretical standards. They are not efficient the same way a physical ball is not spherical compared to a mathematical sphere.
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Re:Markets are efficient if and only if P=NP (2010)
by WJW on Wednesday October 21, 2020 @06:02AM
(#24846276)
Of course there are some errors in real life. The more interesting question is how far from optimality the markets are. To carry on your analogy, a tennis ball is not perfectly spherical but it is round enough for practical use.
Similarly, the market can be 99.99% efficient, in which case it's obviously not entirely perfect but close enough that the average citizen is extremely unlikely to find any real arbitrages (which is what the EMH is essentially about).