Probabilities

I often think I should announce that I have a wunnerful scheme that's guaranteed to make money 95% of the time!, over 10 years. Then you try it and lose money. Then I say: "Too bad. You're in that last 5%." You say: "So what's that 95% all about?" Then I say: "It means that if you repeated my scheme a jillion times, you'd make money 95% of the time.". Cute, eh? I know perfectly well that you can't repeat it a jillion times ... so I'm correct, in my announcement. Indeed, I'm always amused when gurus say that there's a 95% probability that your retirement portfolio will survive 40 years with an x% withdrawal rate. Now, if you believed in a hundred reincarnations ... Aah, but what if you repeated my scheme hundreds of times? Then, if it were efficacious, you should be able to make money, eh? Indeed, even if my scheme worked, say 60% of the time, you should make money if'n you applied it hundreds of times. Okay, so I been thinkin' about that Blake ritual for Buying and Selling stocks mutual funds. Blake identified funds where the probability of success was over 60% (based upon analysis of historical data) ... then he traded like crazy!! Alas, that'd require that trading fees were minimal. Yesterday, Ron McEwan wrote to me about the Blake ritual: The US government employee retirement plan (Thrift Savings Plan) is the largest pension plan in the world. You could trade in and out of about 10 different funds as much as you want with no charges. One day someone at the Fed found out that some guys had made themselves over 3 million dollars using a similar strategy. It wasn't illegal, but shortly after it was discovered, the Plan changed the rules to make it unprofitable. Ron also provided these: Click!   Click!