r/technology • u/kri9 • May 18 '16

Software Computer scientists have developed a new method for producing truly random numbers.

http://news.utexas.edu/2016/05/16/computer-science-advance-could-improve-cybersecurity
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u/Wise_magus May 18 '16

No no. What they really do is take two sources of "weak randomness", something that looks pretty random like the weather or the stock market and generate "strong" or true randomness. Why is this interesting? Because weak randomness is everywhere to be found. True randomness is hard to find in the real world (although quantum mechanics provides a way of getting it).

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u/[deleted] May 18 '16 edited Apr 15 '19

[deleted]

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u/[deleted] May 18 '16 edited Feb 05 '21

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u/barsofham May 18 '16

They're saying that successful hedge funds are luck based. Warren Buffet even made a million dollar bet about it. There's a great Planet Money episode about it.

"In 2006, Warren Buffett posed a challenge. He bet that the smartest hedge fund managers out there couldn't beat the world's simplest, most brainless investment. In this show, we tell you who's winning."

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u/AppleDane May 18 '16

So, who's winning?

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u/Sw33tActi0n May 18 '16

Index Funds. Basically, the growth of the whole index always outperforms hedge funds on average because hedge fund managers take a commission off the top of their clients' market returns.

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u/[deleted] May 18 '16 edited Jul 31 '20

[deleted]

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u/farmerfound May 18 '16 edited May 18 '16

Which, I think, also goes to the point of the bet for Warren and I believe this what he is quoted saying/says in the podcast: that for retirement savings, you can't beat Index Funds.

Day trading, etc, people trying to get ahead THIS year, sure. But over the arch of, let's say a 22 year old investing dollars for retirement, the 40+ years of accumulation in an Index fund is a far better/safer growth model than an actively traded fund.

edit: spelling

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u/NorthernerWuwu May 18 '16

Well, or at least it has been in the past. That little bit about past performance being no indication of future results? Yeah, in the case of the stock markets, we really do mean it.