Path Dependence

Returns chain rather than average, so a 50 percent loss needs a 100 percent gain to repair and the order of outcomes matters as much as their mean. More broadly, small early accidents lock in structures - standards, habits, capital stock - that later logic cannot dislodge. Investors respond by capping position sizes and treating survival as the precondition for every other model.

8 books · 1 people behind it · 4 resources