Friday, July 4, 2008

Somthing to say for getting old - or just ignoring survival bias

Getting old is better than the alternative.

But Floyd Norris suggests that it seems to be better for your investing.

As I am getting older at the rate of one year per year Floyd's article should cheer me up. But it doesn't.

An article that suggests that older investors are less likely to be caught up in a bubble has a causality problem at its heart.

If you are likely to get caught up in a bubble you are unlikely to STILL be a professional investor by the time you are 50.

The article seems to suggest that age makes you wise.

But the alternative hypothesis is also possible: wisdom that allows you to grow old (and stay in business).

And if that is the case getting older at the rate of one year per year has fewer benefits than I hoped.
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