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Keynesian Beauty Contest

en.wikipedia.org

3 points by throw0101c 4 hours ago · 1 comment

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throw0101cOP 4 hours ago

Submitting this apropos of nothing, and for no discernible reason:

> A Keynesian beauty contest is a metaphorical beauty contest in which judges are rewarded for selecting the most popular choices among all judges, rather than those they may personally find the most attractive. This idea is often applied in financial markets, whereby investors could profit more by buying whichever stocks they think other investors will buy, rather than the stocks that have fundamentally the best value, because when other people buy a stock, they bid up the price, allowing an earlier investor to cash out with a profit, regardless of whether the price increases are supported by its fundamentals and theoretical arguments.

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