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#029 GPT-3, Prompt Engineering, Trading, AI Alignment, Intelligence

Machine Learning Street Talk (MLST)

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Smoke and Mirrors in Quant Finance

This chapter examines the deceptive practices in quant finance, particularly how complex analyses can obscure real market risks such as tail risks. It discusses the psychological biases driving investors towards high-risk strategies and critiques the misconceptions surrounding machine learning applications in trading. The conversation highlights the evolving nature of market efficiency while cautioning against overconfidence in predictive models and strategies.

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