©2002, 1998 Charles D. Ellis; (P)2004 AMI
It was great to hear the efficient market hypothesis "straight from the horse's mouth". Ellis' classic paper from the Journal of Fianance comparing professional investing to amateur tennis has been updated and is a compelling description of why active traders should expect to lose.
The debate over Market Efficiency usually destructs because the term "Market Efficiency" can really have two meanings: (1) Prices are Rational and/or (2) that investors can't consistently beat the market. "Winning the Loser's Game" is the classic that gives the philosophical underpinnings for what is born out by the empirical evidence: the markets are efficient from the 2nd perspective - investors can't consistently beat the market. If you think you can beat the market then you have to assume that you know something that all the other smart people don't know and that you can consistenly capitalize on it. Excellent listen. A good one to have for your intellectual tool-kit. Now if we could only get an audio version of Bernstein's "Against the Gods"...
Disclaimer! I only listened to the first three hours of the book. I tried to listen to the whole thing but finally gave up. I got tired of hearing how irrational we individual investors are and how rational the market is and therefore the only way to "win" is to buy an index fund and hold it a long time. This is not new advice.
The beginning was interesting as the author discussed the differences between a winner's game and a loser's game. However, this does not make the audiobook worth using one of my credits on. I wish I had checked it out from the library instead.
The author basically says: professionals and general public are the 80% Losers who cannot beat the market, the only a investor to beat the market is to invest all times and an investor should not time the market. I guess the Author probably came from big liars investment bank like ML, or Goldman Sachs, who like to see investors money erode so they can profit from that.
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