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Subject: Re: OT: AI Will Kill Stock Exchanges

Author: Graham Laight

Date: 15:04:51 06/06/01

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On June 06, 2001 at 13:24:26, Chris King wrote:

>On June 06, 2001 at 13:01:56, Graham Laight wrote:
>
>>Once upon a time, chess computers were expensive, and not especially good.
>>Gradually, they became cheaper and better. Now anyone (who already has a
>>computer) has the ability to sit at home and generate excellent chess moves very
>>cheaply.
>>
>>Right now, if you want to buy the stock selection program "Tradingsolutions", it
>>will cost you $1,000. Presumably, it will allow you to select stocks and time
>>your purchases to improve your chances of making money.
>
>If the people who make this program are so clever why aren't they making
>fortunes for themselves on the stock exchange, instead of trying to con people
>into buying their overpriced program.

Granted - a good point.

However - I wish to make 3 points in reply:

* it probably makes better recommendations than most of the public would

* the same question should be put to stockbrokers, media tipsters, fund
managers, or anyone who ever recommends shares

* eventually, students in universities will be doing such programs as projects

-g

>CK
>
>>
>>In the fullness of time, one would expect the number of people using such
>>programs to increase, and therefore for stock market timing and selection in
>>general to improve.
>>
>>However - if most market participants become cleverer at stock selection, nobody
>>will ever buy a stock if it is significantly above its "true" (by consensus of
>>trading programs) price. Equally, people will be unwilling to sell below the
>>"true" price.
>>
>>The consequence of this will be that stock market graphs, which are currently
>>bouncy and full of life, will become a deathly dull flat line. No more
>>opportunities to make "a killing" for anyone.
>>
>>Right now, I believe that this, fantastic as it sounds, will actually happen.
>>
>>AI could have many strange, unexpected consequences!
>>
>>n.b. - website for AI trading - http://www.neural101.com
>>
>>-g



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