Alpha, and statistics in investing
I am currently studying for CFA, and right now I am studying the statistics part. While I find statsitics to be a relatively easy math, I don't see its usefulness in investing.
I don't think you can use past data and analyze it statistically to anticipate the likelihood of an event occuring again with stocks. Stocks are chaotic and constantly changing, unlike observing something in nature.
Also, I think the concept of alpha is ridiculous. If a bluechip company has historically moved up or down only 1% per year, but it is in a dying industry...compare that to a company which got slammed because of the recession, and is down 90% from its recent high, but will survive the downturn. So the company that is already down 90% is riskier, just because it made a bigger move? Who cares what the "risk-adjusted return" is. The only thing that matters is the ACTUAL return. Volatility does not matter as long as you don't buy and sell at the wrong times, and if you are doing so, you should not be managing money as a career in the first place!
Discussion is welcomed.