Stock Market Behavior Predicted by Rat Neurons

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Browser
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Stock Market Behavior Predicted by Rat Neurons

Post by Browser » Sat Jan 03, 2015 1:01 pm

I felt it was of great importance to bring this pivotal research publication to the attention of Bogleheads. It convincingly illustrates that stock market behavior can be predicted and that the Boglehead philosophy is entirely wrong:

Summary
For our analysis, we adopted the standard practice in neurophysiology where researchers will record a population of
neurons, say 500, and find 50 that respond to a certain stimulus.

We found that stocks correlate with the firing rates of motor cortex neurons in rats. We also generalized our model to
predict future stock price, and we made $435 from an initial $1000 investment in 20 days by using neuronal firing rates to
predict whether to buy, short, or hold shares in Asta Funding, Inc

Nobel Prize-winning economist Paul Samuelson said in a 1967 declaration to the U.S. Senate that buying a mutual fund is
worse than throwing darts at a dartboard. As a consequence, index and hedge funds are now popular. We say that if you are
not using a rat motor cortex model of stock price, you might as well be using a mutual fund.
Annals of Improbable Research | July-August 2006 http://www.improbable.com
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chaz
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by chaz » Sat Jan 03, 2015 1:10 pm

I prefer using darts.
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by itstoomuch » Sat Jan 03, 2015 1:20 pm

Scott Adams wrote a novelize treatise on this (early 80's or late 70's). Later became a successful serialized radio show and a mediocre movie.
Random events ALWAYS win. (Rats ie White Lab Mice, do eventually lose out to random and improbable events) Don't fight it.
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baw703916
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by baw703916 » Sat Jan 03, 2015 1:25 pm

The hard part is identifying the rat neurons that will outperform in advance.
Most of my posts assume no behavioral errors.

Pocanutin
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by Pocanutin » Sat Jan 03, 2015 1:42 pm

Is there a newsletter that I can subscribe to?

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gardemanger
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by gardemanger » Sat Jan 03, 2015 1:52 pm

But do the rats sleep well at night???

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baw703916
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by baw703916 » Sat Jan 03, 2015 1:52 pm

Here's what can happen if you pick the wrong rat neurons:

http://dilbert.com/strips/comic/2010-07-03/

:twisted:
Most of my posts assume no behavioral errors.

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baw703916
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by baw703916 » Sat Jan 03, 2015 1:56 pm

gardemanger wrote:But do the rats sleep well at night???
I think they're nocturnal, so probably not. :)
Most of my posts assume no behavioral errors.

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tetractys
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by tetractys » Sat Jan 03, 2015 1:59 pm

Certainly rat neurons are not all that much different from our own, nor from the researcher's neurons. -- Tet
Last edited by tetractys on Sat Jan 03, 2015 2:02 pm, edited 1 time in total.

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gardemanger
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by gardemanger » Sat Jan 03, 2015 2:00 pm

Presumably on the rat Boglehead boards they speak of each rat's individual Sleep Well Diurnally asset allocation.

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nisiprius
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by nisiprius » Sat Jan 03, 2015 2:09 pm

It's been shown that rats dream, and even, in one case, what they dream about:
"We looked at the firing patterns of a collection of individual cells to determine the content of rats' dreams. We know that they are in fact dreaming and their dreams are connected to actual experiences." ...

The researchers then examined more than 40 REM episodes recorded while the rats slept. About half repeated the unique signature of brain activity that was created as the animal ran. The correlation was so close that the researchers found that as the animal dreamed, they could reconstruct where it would be in the maze if it were awake and whether the animal was dreaming of running or standing still.
These memories were replayed at about the same speed that the animal had experienced them while awake.
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by minesweep » Sat Jan 03, 2015 4:19 pm

gardemanger wrote:But do the rats sleep well at night???
Maybe the question should be "do rats sleep well during the daytime"?

Mike

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Epsilon Delta
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Re: Stock Market Behavior Predicted by Rat Neurons

Post by Epsilon Delta » Sat Jan 03, 2015 5:03 pm

gardemanger wrote:But do the rats sleep well at night???
Do rats sleep well after their neurons have been used for research? Do they sleep with the fishes? Would it be more ethical to use neurons from another source?

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Re: Stock Market Behavior Predicted by Rat Neurons

Post by Miriam2 » Sat Jan 03, 2015 5:05 pm

I would like to say a few words on behalf of rats.
In the wonderful children's book, "Mrs. Frisby and the Rats of NIMH" - which, Nisiprius, your grandchildren would love to read - the scientists teach the laboratory rats how to read.
The rats look around, read the "Exit" sign, and are outa there.
So maybe reading stocks is not so farfetched....

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