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Martin Schwoerer's avatar

Investing based on "vulnerabilities" is a losing concept: agreed. The only such approach that I know of that has a good track record might be Taleb's, yet his is hardly replicable.

"We all tend to overestimate the likelihood of extremely unlikely events." -- Again re Taleb, that sentence sounds surprising. If I understand him correctly, he says there are a lot more fat tails around than people realize, that thousand-year-floods actually happen once a lifetime. And since catastrophic events do happen unexpectedly, it is necessary to design one's portfolio that such an event is not ruinous.

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Peter Odenthal's avatar

Endless waiting until you‘re right is now less painful for one type of trade: shorting stocks that don‘t pay a dividend has positive carry now that interest rates are significantly higher than zero. (Of course you still run the risk that the market pushes the price higher and a margin call is triggered).

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