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April 04, 2007

Stock or Not

A good friend of mine Josh Reich has built a simple but compelling game where you are presented with a chart constiting of data from a real financial market alongside a chart of some random data - you are charged with the task of spotting the fakes.

Turns out its harder than it seems, although the average is 50%. On the surface that kinda says to me technical analysis is bogus, but here is the thing... people are either horrendously bad or exceptionally good at it.

I have been hassling Josh to include a survey to determine if there is a correlation between adeptness at spotting fake stock charts and being a successful trader (or a wall street zip code).

Which leads me to the question..
Can u guess the difference between a real stockchart and a random pile of junk?