Many years ago (circa 2005), I came across the below food-for-thought piece from a musical theorist named Lee Humphries. The ideas presented intrigue to this day.
Investment assumptions aside — An 8.5% passive return? Good luck with that— the concepts of compounding and Metcalfe’s law (aka network effects) apply strikingly well to the development of expert knowledge… and the theory and practice of trading.
What’s more, a persistently cultivated “perception of subtleties” is, indeed, a large part of what trading is all about.
So without further ado…
The Mathematics of Persistence (more…)