Note that market inefficiency depends on the observer's knowledge. Most market participants have no demonstrable advantage. For them, just as the cards in blackjack or the numbers at roulette seem to appear at random, the market appears to be completely efficient.

To beat the market, focus on investments well within your knowledge and ability to evaluate, your "circle of competence". Be sure your information is current, accurate, and essentially complete. Be aware that information flows down a "food chain", with those who get it first "eating" and those who get it late being eaten. Finally, don't bet on an investment unless you can demonstrate by logic, and if appropriate by track record, that you have an edge.


~ Edward Thorp