David already has 14 to 1, why would he take 8 to 1?

Jimbo

I was trying to start a dialogue. I would go much higher than 8:1.

You said that earlier in the thread.

Being the generous fellow that I am, I'll let you give me 1/2 of the odds that <0.1% implies.

You've highlighted the optimistic spin on the positive factors. Others here have presented negative factors. You need to talk to an analyst who has dug into the details of this product to find out how accurate some of your above impressions are. However, when all is said what makes you believe these factors were not properly priced into the $6-2 drop when the Lung Cancer report came out? Surely they are all well known to the market.

Evidently all you have to go on is a hunch that the 66% drop is too extreme. This despite the lower probability of ever getting the product approved, the higher cost to a company that will be running out of money for getting it approved, the loss of interest by manufacturing partners, and the greater difficulty in developing a market which could not be developed by Pfizer despite a $2.8 billion effort, and was abandoned by Eli Lily with similiar products.

Maybe you're right. Get a hunch and bet a bunch. But how can you know? What makes you believe the market is not pricing these factors in better than you are doing? If this were a situation where you could do some fundamental analysis to support your hunch you would at least have something to go on. But that's not part of your investment strategy.


PairTheBoard

Now THIS is the post that matters. Its a shame that so few people realize that. I simply refuse to consider information that I assume is properly being taken into account. But this is different. Obviously the market must be setting the odds of FDA approval at a much more optimistic number than you. So I would like to know why you disagree with them.

Also I should remind PTB and others that I never considered MNKD to be a decent example of my stock buying theory. The best example was the lines waiting to play the Monopoly machine the first day of its trial period. I didn't need to know anything else about WMS (except that one blockbuster was significant to them) to make it a great buy.

You still don't get it. This statement is unbelievably absurd.

I think even your cohorts are on record as disagreeing with you on that one. I'll give you the benefit of the doubt and assume that I didn't explain the details well enough in my post. Otherwise how could you possibly dispute the plus EV of the WMS buy?

For the same reason I was able to easily dispute your MNKD buy; details mean everything. More precisely, how the market interprets those details means everything. You have to know all of the assumptions the market is making about the company in order for the current stock price to be where it is. Then you have to compare those assumptions to your new "material" information and see how it fits into the story. I put material in quotes because I find it hard to believe that long lines on an opening day can be significant. To me, it means that many people knew about the Monopoly game and were there waiting to give it a try. If that's the case, then it's likely that the game had been so hyped that it inflated the stock price. After you've taken that into account, I think the more important thing would be whether or not people came back.

Not only is it silly to assume that long lines on opening day means something (nonetheless assuming you know what that something is), it is silly to assume what sort of impact it will have on the stock price without knowing anything about the stock price to begin with.

I'm reading through "Getting the best of it" and he makes a similar though completely wrong statement regarding sports betting. I have no clue about his stock picking theory, but his fundamental views on betting sports are incorrect and may relate to an incorrect view of how money is made in markets.

Getting The Best Of It has been required reading for every employee at Susquehanna Securities for 25 years. I'm told thats true for many other firms as well.

It is almost certain that at least 20 employees of that firm are more likely to be able to turn one million into ten million in five years than anybody on this forum.

There are however a couple of factual errors in that chapter regarding things like middling requirements.

Thats really awesome. I'm glad you just wrote, "Don't point out my flaws. I'm awesome."

I don't even fully understand some of the poker/blackjack parts. But it doesn't change the fact that on the sections that are most applicable to financial markets are the ones where your understanding is either errant or weak.

If you would like to address the issues, you can feel free to start a thread in Sports Betting and have the topic explained to you in a clear and concise manner about how you err.

LOL

Before you make another ******ed baseless post/comment........do you have ANY idea what Susquehanna even specializes in?

Its funny because I turned $50k into more than $1m in five years and I havent read the book.

Three people got lung cancer. I think what's important here is rates.

How long was the study, and how many people would be expected to contract lung cancer in that same amount of time?

I mean, if the trial lasted one day, and 3 people got lung cancer, that's pretty scary, and if it lasted 25 years, and 3 people got lung cancer, its probably preventing cancer.

lol...its funny because you thought you were saying something intelligent.

Well, isn't that the whole point, were the statistics interpreted correctly?

Merck

If only they had a billionaire's reputation at stake.

Also:

I knew the lines were not about people trying a hyped product. And I knew enough about WMS to know that one blockbuster machine was enough to make a big difference in their stock price. But you are still confusing two issues. The debate is not about how one can be sure that someone's special reason to buy or sell is valid. The debate is whether it is important to examine all the other factors IF it is valid.

Ironically I believe that technical traders agree with me on this.

The EMH debates were in the 60s. People laugh at it now. Debate over?

Your comment about the billionaire was an example of shoddy thinking. You said that if the billioniare bases any of his decisions on preserving his reputation then the company is in worse trouble yet. But you didn't realize that this generally true statement falls apart when the company in question is very likely to go out of business.

This has little to do with any EMH debate. Have you noticed that even my detractors are jumping off your bandwagon?

This is so ******ed for a variety of reasons.

1) "Bandwagon"/ad hominem/logicaments blah blah blah
2) Why can't he delve into some esoteric side point? Is this only your special power? Did CF choose flight or super strength instead?
3) I think people have given up on this because its stupid. Not because they are "seeing the light". Or whatever.


BTW I'm forcing myself through the rest of "Getting the Best of It". You can add "Incorrect computation of no-vig/true line" to your list of errors. Perhaps "Fixed Odds Sports Betting" by Joseph Buchdahl can help you clarify your confusion.

the fact taht you would consider this an EMH debate shows a huge fundamental misunderstanding. you shouldn't even be in this debate if you're going to think that EMH has anything to do with it, because you're not going to come up with a logically sound argument.

His argument rests on him being able to assume the $6 price was correct. This implies EMH (or just handwaving in order to be able to use pot odds but not be applicable at all to markets).

Given 1) Handwaving/EMH and 2) His "insight" actually means something then of course this would be +EV. That's not the points I've been making. My point was that (1) and (2) are dumb and therefore this thread is dumb. Although only (1) or (2), not both would have to be dumb for this thread to be dumb. He just happens to be Dumb x 2.

Meh, deleted. Not worth it imo.