Where There’s a Rule, There’s a Way
The article in Wired magazine is a great reminder to all traders of what modern trading is all about.
The article is not about trading, by the way. It is a story of a geological statistician, Mohan Srivastava, who cracked the code of a scratch-n-win game called tic-tac-toe without cheating. It happened in Toronto and was headline news several years ago in Toronto. Since then he continues to discover that the same problem exists in many other lottery tickets sold across North America.
Drawing strange parallels from the story on these lottery games and modern trading,
- Both are highly computerized in their respective infrastructures
- Players who participate without questioning the systems lose all the time in aggregated term
- By design, both create the feeling of excitement and close chances to win to get their players hook onto the game
- Both have so much common knowledge and assumptions associated with them that are wrong. e.g the lottery games are truly random and price actions are unpredictable
Other suggestions from the article draws some more (controversial) parallels,
- Both are used by organized crimes to launder money
- Both are there to give hope to the disadvantaged crowd but the hidden agenda is to suck up their money to feed the system
- Both are so wired to computerization that patterns are bounded to emerge. i.e. computer generated tickets vs. algorithmic trading
- Someone who can step outside of the system and look at the games in a different way can yield high probability winning formulas to beat these games
Isn’t that something to think about?