Quote from: RationalSpeculator on July 28, 2013, 12:05:58 AM

Quote from: canuck on July 27, 2013, 11:39:45 PM

People trying to invest and divest using the site's profit percentage as prime investment and divestment points are buying into the gambler's fallacy just the same as those who employ martingale gambling strategies not in that they're trying to invest and divest multiples of anything but rather in that they believe the past will influence the future.

For example, some one might choose to divest when the site is up in total profit by 1.5% and re-invest when the site drops to -1.5% or perhaps they will choose some manner of determining when the site's profits have been eaten into a sufficient amount to make investment statistically better than before.

Whatever the case, it's something of a follie I think though I'm happy to be corrected. It seems to me that even if the site dips to -1.5% profit, there's nothing to say that it's not just as likely at that time for the site to go to -5% as it is to increase by the same number of points (3.5 points) to +2% profit

I don't have anything against this of course. I'm happy to keep my pitiful little chunk in there no matter the variance and it seems to me that strategic investing/divesting is just trying to predict random chance as the site's retail side investors are doing.

I dunno. I could be full of crap. Did I miss something here?

Yes, I think you missed my argument in favor of reducing investment when site is up and vice versa, what do you think of it?

I think you're taking investor psychology into consideration where I am (perhaps erroneously) dismissing it in favour of cold and technical statistical basics. I'm not sure which approach it more merited. Mine is a rule based approach where yours is more dependant on human emotions which are perhaps more unpredictable to people like me (I'm bad at reading others in personal situations) but exist none the less.

The reason I find more merit in my approach currently is because despite the fact that people seemed to follow along with your perceived interpretation of their motivations, (when site is up, more people invest and when site is down, people panic and divest) it doesn't change the fact that their actions could have been completely justified had the site's profits continued decreasing. Again, because the past does not affect the future, further losses were equally as likely as the gains that were experienced instead. Had the losses continued, those who had divested when the site was down 2K or whatnot would have been vindicated in their chosen course of action. If crafty sorts had invested while the site was down, their actions too would have been judged as positive but again, the likelihood of the site experiencing further losses even when down is still just as likely at that particular point as the gains that were instead realized.

Honestly, I really don't know which interpretation is more merited but I do find my consideration of statistics over emotions to be more understandable and predictable. Not that I'm a statistician or anything, just makes more sense to me.

Quote from: dooglus on July 28, 2013, 01:07:23 AM

The most sensible time to invest is when investments are low, because then each coin you invest represents a larger share of the bankroll, and so gets a correspondingly larger part of any bettor action.

If investors use a bot to invest when the total site investment is below a certain threshold, the bot could well have a stabilising effect on the investment level.

AH! See that I think is probably the best idea for an investment and divestment strategy if one is to be employed but of course, if it proves successful, it ironically would become useless as more and more people employed it. *chuckle*