Thursday, August 13, 2015

Does it make sense to apply complicated mathematics to calculate with precision when the margin of error is +/-10%?



This is more of a philosophical question than general question. Quantitative finance applies highly complicated mathematics and has attracted very smart people to this field lately given the high pay banks are willing to pay for such talent. However, in finance, the margin of error is huge because much of finance and investment relates to the future.


Does it make sense to apply complicated mathematics to calculate with precision when the margin of error is +/-10%?




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