the problems with relying on double-blind, placebo-controlled trials in decision-making, both in and out of the financia

[Triplethought]

OK Paying up on the 500 word Bet with Yodean Essay.

The problems with relying on double-blind, placebo-controlled trials in decision-making, both in and out of the financial market.

While Double-blind, placebo-controlled trials are the "gold standard" in science, they are expensive, time consuming, and in many cases an impractical way to make decisions in which you have limited information. A blinded study is research conducted in a way that prevents the subjects from knowing the treatment they are given so that the researcher is guaranteed a biased free result. Information that can influence the subjects of a research is withheld from the subjects until the completion of the research. If good blinding is carried out on the subjects, it can eliminate any form of biases that may arise from the subjects’ expectations, influence from the researcher, researcher’s bias, and other forms of biases that may occur in a research test. Blinding can be done from the researcher to the subjects, the analysts, and even the judges or evaluators.

However, to even form a hypothesis (whether it’s for a medical treatment, a financial model, or any other endeavor of life), one must be open to observation and informal trial. A hunter notices a deer in a particular spot at a particular time of day and wonders if the deer is there on the way to find water. He could "do a double-blind `study" in which he spends many hours and employs assistants who don’t know what his hypothesis is. They can spend months doing observation and taking deer. Or, more practically, he could just go to the nearest source of water with his bow and arrow and wait. Chances are his commonsense theory will lead to being able to eat that night. Frequently such informal observations lead to wild success and is how humans survived for millions of years before the double blind study was even invented.

In the financial market double blind studies are essentially impossible as markets are extremely unpredictable and keeping investors in the dark is not practical.
In drug treatment a huge disadvantage of a double-blind study is that it is so expensive. It takes too long because the researcher must examine all the possible variables and they may have to use different groups to gather enough data.

Many companies know that it costs millions of dollars and requires that they spread the research across many years to justify the cost. This is one of the reasons why new prescription medicines are so costly.
Because of the cost the sample sizes are usually kept small. Most double-blind studies may use 100 people when the preferable number is 300. It is true that the effectiveness of a treatment can be proven even in small studies, but more people or participants are required to determine a pattern in research so that the results can be properly analyzed and verified.

Additionally, participants may react negatively to the treatment item, making final results based on even smaller samples. Some participants may react negatively to the placebo which may lead to producing some side effects that may make it seem like they were receiving the treatment item when they did not.
Many times, it is almost impossible to complete a double-blind study. For example, you cannot keep the subject or participants of a psychotherapy experiment in the dark about who gets the treatment item and who doesn’t get the treatment item. Double-blind study can only work in this scenario if you find a way to provide two similar procedures without each of the groups communicating about which group is getting the treatment item and which group is getting the placebo.

While double blind science has its place, there are many places where it is just too expensive, time consuming or impractical to yield a result. In those places Human intuition and observation will reign supreme.

[jlhooter]

I counted 497 words. Anything else to add?
Kidding of course. Nice job

[SOL]

OK Paying up on the 500 word Bet with Yodean Essay.

The problems with relying on double-blind, placebo-controlled trials in decision-making, both in and out of the financial market.

While Double-blind, placebo-controlled trials are the "gold standard" in science, they are expensive, time consuming, and in many cases an impractical way to make decisions in which you have limited information. A blinded study is research conducted in a way that prevents the subjects from knowing the treatment they are given so that the researcher is guaranteed a biased free result. Information that can influence the subjects of a research is withheld from the subjects until the completion of the research. If good blinding is carried out on the subjects, it can eliminate any form of biases that may arise from the subjects’ expectations, influence from the researcher, researcher’s bias, and other forms of biases that may occur in a research test. Blinding can be done from the researcher to the subjects, the analysts, and even the judges or evaluators.

However, to even form a hypothesis (whether it’s for a medical treatment, a financial model, or any other endeavor of life), one must be open to observation and informal trial. A hunter notices a deer in a particular spot at a particular time of day and wonders if the deer is there on the way to find water. He could "do a double-blind `study" in which he spends many hours and employs assistants who don’t know what his hypothesis is. They can spend months doing observation and taking deer. Or, more practically, he could just go to the nearest source of water with his bow and arrow and wait. Chances are his commonsense theory will lead to being able to eat that night. Frequently such informal observations lead to wild success and is how humans survived for millions of years before the double blind study was even invented.

In the financial market double blind studies are essentially impossible as markets are extremely unpredictable and keeping investors in the dark is not practical.
In drug treatment a huge disadvantage of a double-blind study is that it is so expensive. It takes too long because the researcher must examine all the possible variables and they may have to use different groups to gather enough data.

Many companies know that it costs millions of dollars and requires that they spread the research across many years to justify the cost. This is one of the reasons why new prescription medicines are so costly.
Because of the cost the sample sizes are usually kept small. Most double-blind studies may use 100 people when the preferable number is 300. It is true that the effectiveness of a treatment can be proven even in small studies, but more people or participants are required to determine a pattern in research so that the results can be properly analyzed and verified.

Additionally, participants may react negatively to the treatment item, making final results based on even smaller samples. Some participants may react negatively to the placebo which may lead to producing some side effects that may make it seem like they were receiving the treatment item when they did not.
Many times, it is almost impossible to complete a double-blind study. For example, you cannot keep the subject or participants of a psychotherapy experiment in the dark about who gets the treatment item and who doesn’t get the treatment item. Double-blind study can only work in this scenario if you find a way to provide two similar procedures without each of the groups communicating about which group is getting the treatment item and which group is getting the placebo.

While double blind science has its place, there are many places where it is just too expensive, time consuming or impractical to yield a result. In those places Human intuition and observation will reign supreme.

Quite a nice job. Congrats on being able to view this sujbect from the opposing angle

[Triplethought]

Quite a nice job. Congrats on being able to view this sujbect from the opposing angle

Thanks. I was afraid I'd get roasted.

[Yodean]

I counted 497 words. Anything else to add?
Kidding of course. Nice job

Lol ... maybe I can add the following sentence to YoungAnakin's post, to complete the 500+ word part: "The absence of evidence is not evidence of its absence."

Nicely played, YoungAnakin - the Force yet glimmers in you, albeit dimly (vax blocks Force).

[AstuteShift]

We have history of human behavior at various conditions with the markets

Human behavior unfortunately has not changed much, if at all so even if the scenery changes, the market in a way gives you clues on how to survive

However, not everyone can. I’d say, studies now can be worthless now since they have can a certain bias or narrative. This is in a way is to confuse, disarray the masses.

Hence MP is the ultimate key. As an investor, you don’t have friends. The more you have around you the more you will lose

SOL had one timeless quote and it’s so true

United we fail, divided we rule the roost. Classic

The markets, while it’s fun to analyze, is very destructive and destroys what it means to be human.

I’m no communist or utopian but it’s obvious that the system we have is pretty darn corrupt.

If you can accept it’s a Ponzi scheme and follow the rules of the game then you can win in silence

[Yodean]

If you can accept it’s a Ponzi scheme and follow the rules of the game then you can win in silence

Indeed, the best retail investors trade alone, usually against the Herd.

Win silently, but celebrate loudly and drink from the blood of your fallen frenemies, as long as they haven't been vaxxed more than twice.

[chippermon]

If you can accept it’s a Ponzi scheme and follow the rules of the game then you can win in silence

Indeed, the best retail investors trade alone, usually against the Herd.

Win silently, but celebrate loudly and drink from the blood of your fallen frenemies, as long as they haven't been vaxxed more than twice.

This chart tells me there is more pain to come before we reach the moon

[SOL]

This chart tells me there is more pain to come before we reach the moon

Generally speaking, one has to kiss the dust before one can kiss the heavens. We live in consulted times, but data indicates that, to a large degree, the crowd is nonchalant, and this is reflected in the sentiment data. Some fear but stark raving panic or complete hopelessness is missing