Abstract
We argue that the financial markets have a predetermined outcome. They behave deterministically but appear to follow random patterns. Stock prices have nothing to do with future expectations; they are a reflection of previous convictions coming from the confident investors. A financial crisis is the result of the lack of confidence that characterizes a market moments before the crisis. Stocks returns are perfectly correlated to each other and it is possible to obtain high gains consistently. Finally we provide a different way of assessing risk and suggest a method to sense future performances.
Keywords
- Stock Search this journal for Stock (opens in a new tab)
- Market Search this journal for Market (opens in a new tab)
- Predictability Search this journal for Predictability (opens in a new tab)
- Confidence Search this journal for Confidence (opens in a new tab)
- Investors Search this journal for Investors (opens in a new tab)
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Keywords
- Stock Search this journal for Stock (opens in a new tab)
- Market Search this journal for Market (opens in a new tab)
- Predictability Search this journal for Predictability (opens in a new tab)
- Confidence Search this journal for Confidence (opens in a new tab)
- Investors Search this journal for Investors (opens in a new tab)
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