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Investment Philosophy: Difference between revisions
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When doing hypothesis testing of cause-effect relationships we do look both for strong historical correlations <u>and</u> logical explanations for those correlations. | When doing hypothesis testing of cause-effect relationships we do look both for strong historical correlations <u>and</u> logical explanations for those correlations. | ||
We do weigh our confidence in a correlation significantly lower if we cannot understand the root cause | We do weigh our confidence in a correlation significantly lower if we cannot understand the root cause or even disregard it completely if have good reasons for it. | ||
We explicitly <u>invite you</u> to challenge all our assumptions if they are not logical or feel inconsistent to you, or you think we are missing an important point. We will then take your considerations into account, revisit the assumptions and correlations if needed or simply do at better job of mapping out the logic of those assumptions better and increase the transparency of the model. | We explicitly <u>invite you</u> to challenge all our assumptions if they are not logical or feel inconsistent to you, or you think we are missing an important point. We will then take your considerations into account, revisit the assumptions and correlations if needed or simply do at better job of mapping out the logic of those assumptions better and increase the transparency of the model. | ||