Is There a Better Way?

This morning I take a macroscopic view wondering what I’m trying to do here and why I seem to disagree with so many others in the financial industry. It’s not just that I’m trying to find a better approach: I’m trying to determine whether a better approach even exists.

I am not exaggerating when I say almost everywhere I look, I see marketing of a better trading/investing approach (substitute “Holy Grail” to make for slight exaggeration). Many seemingly innocent, matter-of-fact claims are actually the Holy Grail in disguise but that’s beyond the scope of this post.

Just as I questioned whether successful traders exist, I question whether a better trading/investing approach exists.

Consider the following observations:

     –The disappearance of popular/outspoken traders over time
     –Frequent flaws in advertising/marketing claims (e.g. affirming the
       consequent, hasty generalization, fallacy of the well-chosen example)
     –Rampant confirmation bias
     –General ignorance about trading system development and inferential
       statistics: tools capable of installing meaningful objectivity into an
       environment of variable moving targets
     –Multiple “professionals” telling me that generation of consistent, modest
       annual returns [in comparison to what many investment newsletters and
       trader education programs advertise] would have the big money storming
       down my door to invest if I were to start a hedge fund
     –Repetitive articles in financial planning and investment periodicals about
       slight outperformance relative to benchmarks translating to large AUM
     —American Greed on CNBC
     –Financial industry’s overall ignorance about and misrepresentation of options
       to the general public
     –Attraction of discretionary trading as the Holy Grail for many profit seekers

If the concept of “a better investing approach” were on trial then perhaps none of these observations taken individually would be sufficient for debunking. Taken together, however, I see a boatload of reasonable doubt.

Sometimes I feel like X-Files. On the TV program, Mulder feels compelled to continue searching to ultimately discover “the truth is out there.” With regard to finance, I wonder if there is no particular truth to be found (i.e. a better way) even though everywhere I look I see advertising suggesting there is.