Game Theory And The Markets
When you take a position in the market, you are really playing a game
against the market. Profitability doesn’t lie in your actions alone, it lies
in the interaction between your position and the market’s price
fluctuations…The goal of the individual is obvious. It is to make money. But
what is the goal of the market? Simply put, the market wants you to lose
money. This may be a provocative thought, but it is quite reasonable in the
context of game theory.
—from
Gaming the Market, by Ronald B. Shelton (1997, John Wiley &
Sons, New York).
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