216 Matching Annotations
  1. Jun 2024
    1. TensionThe ability to see like a data structure afforded us the technology we have today. But it was built for and within a set of societal systems—and stories—that can’t cope with nebulosity. Worse still is the transitional era we’ve entered, in which overwhelming complexity leads more and more people to believe in nothing. That way lies madness. Seeing is a choice, and we need to reclaim that choice. However, we need to see things and do things differently, and build sociotechnical systems that embody this difference.This is best seen through a small example. In our jobs, many of us deal with interpersonal dynamics that sometimes overwhelm the rules. The rules are still there—those that the company operates by and laws that it follows—meaning there are limits to how those interpersonal dynamics can play out. But those rules are rigid and bureaucratic, and most of the time they are irrelevant to what you’re dealing with. People learn to work with and around the rules rather than follow them to the letter. Some of these might be deliberate hacks, ones that are known, and passed down, by an organization’s workers. A work-to-rule strike, or quiet quitting for that matter, is effective at slowing a company to a halt because work is never as routine as schedules, processes, leadership principles, or any other codified rules might allow management to believe.The tension we face is that on an everyday basis, we want things to be simple and certain. But that means ignoring the messiness of reality. And when we delegate that simplicity and certainty to systems—either to institutions or increasingly to software—they feel impersonal and oppressive. People used to say that they felt like large institutions were treating them like a number. For decades, we have literally been numbers in government and corporate data structures. BreakdownAs historian Jill Lepore wrote, we used to be in a world of mystery. Then we began to understand those mysteries and use science to turn them into facts. And then we quantified and operationalized those facts through numbers. We’re currently in a world of data—overwhelming, human-incomprehensible amounts of data—that we use to make predictions even though that data isn’t enough to fully grapple with the complexity of reality.How do we move past this era of breakdown? It’s not by eschewing technology. We need our complex socio-technical systems. We need mental models to make sense of the complexities of our world. But we also need to understand and accept their inherent imperfections. We need to make sure we’re avoiding static and biased patterns—of the sort that a state functionary or a rigid algorithm might produce—while leaving room for the messiness inherent in human interactions. Chapman calls this balance “fluidity,” where society (and really, the tech we use every day) gives us the disparate things we need to be happy while also enabling the complex global society we have today.
    2. But that’s not the case for a computer, or a robot, or even a corporate food service, which can’t navigate the intricacies and uncertainties of the real world with the flexibility we expect of a person. And at an even larger scale, our societal systems, whether we’re talking about laws and governments or just the ways our employers expect us to get our jobs done, don’t have that flexibility built into them. We’ve seen repeatedly how breaking corporate or government operations into thousands of disparate, rigid contracts ends in failure.
    1. Advocating for the great booksidea, then, could mean fighting against anti-intellectualism, antira-tionalism (i.e., the reliance on ideology), and “agnotology.”

      definition of agnotology:

      Within the sociology of knowledge, agnotology (formerly agnatology) is the study of deliberate, culturally induced ignorance or doubt, typically to sell a product, influence opinion, or win favour, particularly through the publication of inaccurate or misleading scientific data (disinformation). More generally, the term includes the condition where more knowledge of a subject creates greater uncertainty. https://en.wikipedia.org/wiki/Agnotology

  2. Nov 2023
    1. Reflecting on this, I'm reminded of a pattern that has been evident since my days co-running Third Wave with Johannes: the adoption of Uncertainty Coping Strategies. Broadly speaking, these are various behaviors, products, and practices people employ to manage the strains of everyday reality. Our work has consistently identified a spectrum ranging from technological interventions like neuroimplants to the rise in mindfulness services.The staggering contrasts in how different socioeconomic groups address these pressures are well illustrated by the recent New York Times article.

      'uncertainty coping strategies' equal living your life I suppose, in the face of the 'strains of everyday reality' since the groups in caves. What is different here wrt Igor and Johannes' work experience and patterns. Just Urbanism (then how is this diff from 18th century?) The complexity of those strains? The inability to withdraw from strains created by others through industrial work practices / social media algo inducement? The sense of looming doom wrt ecocollapse, financial crash etc, systemic threats iw and no agency to individually address some of that? Or is it merely the high end market catering to it, exploiting the stress rather than solving the stressors? What is Igo saying here?

  3. Sep 2023
    1. This is one of the challenges of being reactive to the public mood, rather than shaping it. Donald Trump, too, launched his first presidential campaign by elevating arguments and rhetoric from right-wing media, but he also shaped what the media was talking about. DeSantis has largely followed the trends, and the trends shift.

      While Donald J. Trump seemed to hold say over what was trending and the media was discussing, Philip Bump notices that Ron DeSantis seems to be trailing or perhaps riding the trends rather than leading them.

      Is this because he's only tubthumping one or two at a time while Trump floats trial balloons regularly and is pushing half a dozen or more at time?

  4. Aug 2023
    1. when we step into uncertainty, our bodies respond physiologically and mentally.
      • for: transition, uncertainty, uncertainty - neuroscience, ingroup, outgroup, letting go, lifetime student
      • paraphrase
        • Uncertainty brings
          • immune system deterioration
          • brain cells wither and even die
          • creativity and intelligence decrease
        • We often go from fear to anger because fear is a state of certainty.
        • We become morally judgmental, an extreme version of oneself.
          • conservatives become ultra-conservative
          • liberals become ultra liberal.
        • because we retreat to a place of safety and familiarity.
        • The problem is that the world changes.
        • Since we have to adapt or die, if we want to shift from A to B,
          • the first step is not B.
          • the first step is to go from A to not A
            • to let go of our biases and assumptions;
            • to step into the very place that our brain evolved to avoid;
            • to step into the place of the unknown.
            • to step into a liminal space
      • comment
        • Uncertainty is uncomfortable
        • and can drive us into our familiar, accepted, insular ingroup
        • In other words, lead to greater social polarization.
        • Adaptation requires us to step into the unknown.
        • Big changes in our lives therefore require us to go
          • from the familiar and comfortable space,
          • to the unfamiliar and uncomfortable
            • movement away from our comfort zone, as is happening as the polycrisis we face gains traction.
  5. Jul 2023
  6. May 2023
  7. Jan 2023
    1. Note 9/8j says - "There is a note in the Zettelkasten that contains the argument that refutes the claims on every other note. But this note disappears as soon as one opens the Zettelkasten. I.e. it appropriates a different number, changes position (or: disguises itself) and is then not to be found. A joker." Is he talking about some hypothetical note? What did he mean by disappearing? Can someone please shed some light on what he really meant?

      On the Jokerzettel

      9/8j Im Zettelkasten ist ein Zettel, der das Argument enthält, das die Behauptungen auf allen anderen Zetteln widerlegt.

      Aber dieser Zettel verschwindet, sobald man den Zettelkasten aufzieht.

      D.h. er nimmt eine andere Nummer an, verstellt sich und ist dann nicht zu finden.

      Ein Joker.

      —Niklas Luhmann, ZK II: Zettel 9/8j

      Translation:

      9/8j In the slip box is a slip containing the argument that refutes the claims on all the other slips. But this slip disappears as soon as you open the slip box. That is, he assumes a different number, disguises himself and then cannot be found. A joker.

      Many have asked about the meaning of this jokerzettel over the past several years. Here's my slightly extended interpretation, based on my own practice with thousands of cards, about what Luhmann meant:

      Imagine you've spent your life making and collecting notes and ideas and placing them lovingly on index cards. You've made tens of thousands and they're a major part of your daily workflow and support your life's work. They define you and how you think. You agree with Friedrich Nietzsche's concession to Heinrich Köselitz that “You are right — our writing tools take part in the forming of our thoughts.” Your time is alive with McLuhan's idea that "The medium is the message." or in which his friend John Culkin said, "We shape our tools and thereafter they shape us."

      Eventually you're going to worry about accidentally throwing your cards away, people stealing or copying them, fires (oh! the fires), floods, or other natural disasters. You don't have the ability to do digital back ups yet. You ask yourself, can I truly trust my spouse not to destroy them?,What about accidents like dropping them all over the floor and needing to reorganize them or worse, the ghost in the machine should rear its head?

      You'll fear the worst, but the worst only grows logarithmically in proportion to your collection.

      Eventually you pass on opportunities elsewhere because you're worried about moving your ever-growing collection. What if the war should obliterate your work? Maybe you should take them into the war with you, because you can't bear to be apart?

      If you grow up at a time when Schrodinger's cat is in the zeitgeist, you're definitely going to have nightmares that what's written on your cards could horrifyingly change every time you look at them. Worse, knowing about the Heisenberg Uncertainly Principle, you're deathly afraid that there might be cards, like electrons, which are always changing position in ways you'll never be able to know or predict.

      As a systems theorist, you view your own note taking system as a input/output machine. Then you see Claude Shannon's "useless machine" (based on an idea of Marvin Minsky) whose only function is to switch itself off. You become horrified with the idea that the knowledge machine you've painstakingly built and have documented the ways it acts as an independent thought partner may somehow become self-aware and shut itself off!?!

      https://www.youtube.com/watch?v=gNa9v8Z7Rac

      And worst of all, on top of all this, all your hard work, effort, and untold hours of sweat creating thousands of cards will be wiped away by a potential unknowable single bit of information on a lone, malicious card and your only recourse is suicide, the unfortunate victim of dataism.

      Of course, if you somehow manage to overcome the hurdle of suicidal thoughts, and your collection keeps growing without bound, then you're sure to die in a torrential whirlwind avalanche of information and cards, literally done in by information overload.

      But, not wishing to admit any of this, much less all of this, you imagine a simple trickster, a joker, something silly. You write it down on yet another card and you file it away into the box, linked only to the card in front of it, the end of a short line of cards with nothing following it, because what could follow it? Put it out of your mind and hope your fears disappear away with it, lost in your box like the jokerzettel you imagined. You do this with a self-assured confidence that this way of making sense of the world works well for you, and you settle back into the methodical work of reading and writing, intent on making your next thousands of cards.

  8. Dec 2022
    1. We analyzed URLs cited in Twitter messages before and after the temporary interruption of the vaccine development on September 9, 2020 to investigate the presence of low credibility and malicious information. We show that the halt of the AstraZeneca clinical trials prompted tweets that cast doubt, fear and vaccine opposition. We discovered a strong presence of URLs from low credibility or malicious websites, as classified by independent fact-checking organizations or identified by web hosting infrastructure features. Moreover, we identified what appears to be coordinated operations to artificially promote some of these URLs hosted on malicious websites.
    1. We found that users who followed elites who made more false or inaccurate statements themselves shared news from lower-quality news outlets (as judged by both fact-checkers and politically-balanced crowds of laypeople), used more toxic language, and expressed more moral outrage.

      Elite mis and disinformation sharers have a negative effect on followers.

    2. In the co-share network, a cluster of websites shared more by conservatives is also shared more by users with higher misinformation exposure scores.

      Nodes represent website domains shared by at least 20 users in our dataset and edges are weighted based on common users who shared them. a Separate colors represent different clusters of websites determined using community-detection algorithms29. b The intensity of the color of each node shows the average misinformation-exposure score of users who shared the website domain (darker = higher PolitiFact score). c Nodes’ color represents the average estimated ideology of the users who shared the website domain (red: conservative, blue: liberal). d The intensity of the color of each node shows the average use of language toxicity by users who shared the website domain (darker = higher use of toxic language). e The intensity of the color of each node shows the average expression of moral outrage by users who shared the website domain (darker = higher expression of moral outrage). Nodes are positioned using directed-force layout on the weighted network.

    3. We found that misinformation-exposure scores are significantly positively related to language toxicity (Fig. 3a; b = 0.129, 95% CI = [0.098, 0.159], SE = 0.015, t (4121) = 8.323, p < 0.001; b = 0.319, 95% CI = [0.274, 0.365], SE = 0.023, t (4106) = 13.747, p < 0.001 when controlling for estimated ideology) and expressions of moral outrage (Fig. 3b; b = 0.107, 95% CI = [0.076, 0.137], SE = 0.015, t (4143) = 14.243, p < 0.001; b = 0.329, 95% CI = [0.283,0.374], SE = 0.023, t (4128) = 14.243, p < 0.001 when controlling for estimated ideology). See Supplementary Tables 1, 2 for full regression tables and Supplementary Tables 3–6 for the robustness of our results.
    1. The style is one that is now widely recognized as a tool of sowing doubt: the author just asked ‘reasonable’ questions, without making any evidence-based conclusions.Who is the audience of this story and who could potentially be targeted by such content? As Bratich argued, 9/11 represents a prototypical case of ‘national dissensus’ among American individuals, and an apparently legitimate case for raising concerns about the transparency of the US authorities13. It is indicative that whoever designed the launch of RT US knew how polarizing it would be to ask questions about the most painful part of the recent past.
    1. In the Irish sample, the combined vaccine hesitant and resistant group differed most pronouncedly from the vaccine acceptance group on the following psychological variables: lower levels of trust in scientists (d = 0.51), health care professionals (d = 0.45), and the state (d = 0.31); more negative attitudes toward migrants (d’s ranged from 0.27 to 0.29); lower cognitive reflection (d = 0.25); lower levels of altruism (d’s ranged from 0.17 to 0.24); higher levels of social dominance (d = 0.22) and authoritarianism (d = 0.14); higher levels of conspiratorial (d = 0.21) and religious (d = 0.20) beliefs; lower levels of the personality trait agreeableness (d = 0.15); and higher levels of internal locus of control (d = 0.14).
    1. The only negative to this method is that it may not ALWAYS work. If the data is faulty, or the link is inaccurately provided by the sender, Gmail won’t be able to recognise and include the unsubscribe button in Gmail.
    2. You may find this link isn’t available straight away, after a few emails one should appear, this is a common technique with mailing list providers.
    1. I often think back to MySpace’s downfall. In 2007, I penned a controversial blog post noting a division that was forming as teenagers self-segregated based on race and class in the US, splitting themselves between Facebook and MySpace. A few years later, I noted the role of the news media in this division, highlighting how media coverage about MySpace as scary, dangerous, and full of pedophiles (regardless of empirical evidence) helped make this division possible. The news media played a role in delegitimizing MySpace (aided and abetted by a team at Facebook, which was directly benefiting from this delegitimization work).

      danah boyd argued in two separate pieces that teenagers self-segregated between MySpace and Facebook based on race and class and that the news media coverage of social media created fear, uncertainty, and doubt which fueled the split.

      http://www.danah.org/papers/essays/ClassDivisions.html

  9. Nov 2022
    1. Trope, trope, trope, strung into a Gish Gallop.

      One of the issues we see in the Sunday morning news analysis shows (Meet the Press, Face the Nation, et al.) is that there is usually a large amount of context collapse mixed with lack of general knowledge about the topics at hand compounded with large doses of Gish Gallop and F.U.D. (fear, uncertainty, and doubt).

  10. Oct 2022
    1. Today, the people in politics who most often invoke the name of Jesus for their political causes tend to be the most merciless and judgmental, the most consumed by rage and fear and vengeance. They hate their enemies, and they seem to want to make more of them. They claim allegiance to the truth and yet they have embraced, even unwittingly, lies. They have inverted biblical ethics in the name of biblical ethics.
    1. Your Alternator Is Not A ChargerYes, you read that right. An alternator is designed to MAINTAIN your car battery, not recharge it from a deeply discharged state. Its designed to run at only 35-50% of its fully rated output. When you use your cars alternator to recharge a dead battery, you force it to run at nearly 100% of its rated capacity and that overheats the alternator and dramatically shortens its life.
    1. But this sounds like spreading fear and doubt when the Ruby parser has no such concepts :) {} always binds tightly to the call right next to it. This block {} will never go to using, unless it's rewritten as do ... end.
  11. Sep 2022
  12. Aug 2022
  13. Jul 2022
    1. that's something that insect with a six-legged version is now it's the whole super organism oh well the ant colony is society that whole frame is actually the shadow of 01:18:52 what the evolutionary reality is which is that the ant colony is an organism not a super organism and the ants are tissues and so which level we prioritize or do we say no there's no a priori level ant is just i'm not even 01:19:05 gonna say there's anything out there called ants it's it's you how you're thinking about it or do we get lost or are we going to find a ladder in that multi-scale yeah well the latter is you know the 01:19:17 latter is active inference because it doesn't say active inference doesn't say make a make an internal model of the world that is accurate that actually accurately captures all the all the 01:19:30 details of the world of the universe that's not the point that's not what the mind does that's not the point the point is to act under uncertainty 01:19:41 given some useful model of the world act under uncertainty so that your fitness score improves and by fitness score here we essentially mean you know and anticipated uncertainty so i i would 01:19:55 very much like to be have some certainty that i'm going to be alive tomorrow and if it's freezing outside and i don't have a coat on uh you know that that becomes iffy so uh i'm going to be happy 01:20:06 if i'm going to be i'm going to go find a coat because it is going to reduce my uncertainty about survival over the next 24 hours but you can expand that you know outward right we we need to act the all organisms are acting under 01:20:19 uncertainty and and we can think about that as we can think about that um we can think from that perspective as a society of what are we doing and how do we measure 01:20:31 success well we're measuring success by acting under uncertainty and then re and then paying attention to what happens and then acting the same or differently or you know some other way or somehow some were 01:20:45 then choosing to act again in this cycle of act uh you know act uh process act process act process you know model act model act model that reminds me of course of the ooda 01:20:57 observe orient side act model and other sort of cyclic models of action and perception and then i would say that active inference provides a few nice little benefits over other phrasings of action and perception 01:21:10 qualitative and philosophical ones like inactivism as well as quantitative ones like cybernetics and other kinds of control theories so i totally agree this

      An organism acts under uncertainty to reduce it to meet its objective.

  14. Jun 2022
    1. This fundamental tension—between quality and quantity—is atension we share as knowledge workers. We also must producework to an extremely high standard, and we must do it fast,continuously, all year long. We are like sprinters who are also tryingto run a marathon.

      Do we? Really? This definitely needs reframing and books like this that play on these sorts of fears are both partially responsible, but are also preying on an atmosphere which they're propagating.

      This is the sort of sad thing that a productivity guru would say...

    1. It’s as if we need the gravitational pull of both worlds to keep us on track, locked on a good and righteous path. Without both worlds pulling on us, we would crash into one, or simply lose our way, hurtling through the universe on our own, intersecting nothing, helping no one.

      As neuroscietist Beau Lotto points out, the Anthropocene is creating greater and greater uncertainty and unpredictability, but the one human trait evolution has created to help us deal with this is the sense of awe. See my annotation on Beau Lotto's beautiful TED Talk: How we experience awe and why it matters https://hyp.is/go?url=http%3A%2F%2Fdocdrop.org%2Fvideo%2F17D5SrgBE6g%2F&group=world

      In short, the sacred is the antidote to the increase in uncertainty and unpredictability as we enter into the space of the Anthropocene. Awe can be the leverage point to the ultimate leverage point for system change that Donella Meadows pointed out many years ago- it can lead to rapid shift in paradigms, worldviews and value systems needed to shift the system.

  15. Apr 2022
    1. Dr. Deepti Gurdasani [@dgurdasani1]. (2021, December 14). So those critiquing others for being too certain (I get subtweeted a lot for this)- Am I certain about the exact impact of omicron in the UK? Not at all Am I certain it’ll be high impact? Quite Am I certain we should act now? Absolutely [Tweet]. Twitter. https://twitter.com/dgurdasani1/status/1470828234480701443

    1. Julia Raifman. (2021, July 25). Policymakers are pointing fingers at “the unvaccinated” What if they gave them a hand instead? - Bring vax & food to workplaces, schools, homes -Fund local doctors, including pediatricians, to call patients & deliver vax—Learn from success of Indian Health Service approach [Tweet]. @JuliaRaifman. https://twitter.com/JuliaRaifman/status/1419288641885593604

  16. Feb 2022
  17. Jan 2022
    1. Goodhart's law is an adage often stated as "When a measure becomes a target, it ceases to be a good measure".[1] It is named after British economist Charles Goodhart, who advanced the idea in a 1975 article on monetary policy in the United Kingdom:[2][3] .mw-parser-output .templatequote{overflow:hidden;margin:1em 0;padding:0 40px}.mw-parser-output .templatequote .templatequotecite{line-height:1.5em;text-align:left;padding-left:1.6em;margin-top:0}Any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes.

      We measure what we find important.

      Measures can and often become self-fulfilling targets. (read: Rankings and Reactivity by W. Espeland and M. Sauder https://www.stmarys-ca.edu/sites/default/files/attachments/files/rankings-and-reactivity-2007.pdf)

      When a measure becomes a target it ceases to be a good measure.

      So why measure?


      Is observation and measurement part of a larger complex process which isn't finished until the process itself is finished?


      This seems related to the measurement problem in quantum mechanics, Schrödinger's cat, the Heisenberg uncertainty principle, and the observer effect).

  18. Dec 2021
  19. Nov 2021
  20. Oct 2021
  21. Sep 2021
  22. Aug 2021
    1. we find that fixing fossil ages to the midpoint or a random point drawn from within the stratigraphic age range leads to biases in divergence time estimates, while sampling fossil ages leads to estimates that are similar to inferences that employ the correct ages of fossils. Second, we show a comparison using an empirical dataset of extant and fossil cetaceans, which confirms that different methods of handling fossil age uncertainty lead to large differences in estimated node ages

      dealing with uncertainties carefully actually matters

    1. Stop trying to connect all the dots ahead of time. Embrace uncertainty and start doing. “You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life." - Steve Jobs

      decent write up, solid concluding quote.

    1. Before you go like “Wow!!!”, understand that the packages highlighted above take a lot into consideration when detecting timezones. This makes them slightly more accurate than Intl API alone.

      What exactly does moment do for us, then, that

      TimeFormat().resolvedOptions().timeZone;

      doesn't do? Name one example where it is more accurate.

  23. Jul 2021
  24. Jun 2021
  25. May 2021
    1. Career decision making involves so much uncertainty that it’s easy to feel paralysed. Instead, make some hypotheses about which option is best, then identify key uncertainties: what information would most change your best guess?

      We tend to think that uncertainties can't be weighted in our decision-making, but we bet on uncertainties all the time. Rather than throw your hands up and say, "I don't have enough information to make a call", how can we think deliberately about what information would reduce the uncertainty?

    2. think of your career as a series of experiments designed to help you learn about yourself and test out potentially great longer-term paths

      I wonder if there's a connection here to Duke, A. (2019). Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts. Portfolio.

      I haven't read the book but it's on my list.

  26. Mar 2021
  27. Feb 2021
    1. In object-oriented programming, information hiding (by way of nesting of types) reduces software development risk by shifting the code's dependency on an uncertain implementation (design decision) onto a well-defined interface. Clients of the interface perform operations purely through it so if the implementation changes, the clients do not have to change.
  28. Dec 2020
  29. Oct 2020
    1. The Y-intercept of the SML is equal to the risk-free interest rate. The slope of the SML is equal to the market risk premium and reflects the risk return tradeoff at a given time: S M L : E ( R i ) = R f + β i [ E ( R M ) − R f ] {\displaystyle \mathrm {SML} :E(R_{i})=R_{f}+\beta _{i}[E(R_{M})-R_{f}]\,} where: E(Ri) is an expected return on security E(RM) is an expected return on market portfolio M β is a nondiversifiable or systematic risk RM is a market rate of return Rf is a risk-free rate

      This is one statement of the key relationship.

      The point is that the market will have a single tradeoff between unavoidable (nondiversifiable) risk and return.

      Asset's returns must reflect this, according to the theory. Their prices will be bid up (or down), until this is the case ... the 'arbitrage' process.

      Why? Because (assuming borrowing/lending at a risk free rate) *any investor can achieve a particular return for a given risk level simply by buying the 'diversified market basket' and leveraging this (for more risk) or investing the remainder in the risk free-asseet (for less risk). (And she can do no better than this.)

    2. This abnormal extra return above the market's return at a given level of risk is what is called the alpha.

      this is why you here the stock-touts bragging about their 'alpha'

    1. Capital asset pricing model

      please read this article

    2. quantity beta (β)

      You hear about this 'beta' all the time as the measure of 'the correlation of the risk of an asset with the representative market basket'...

      but confusingly, \(\beta\) is used to represent the slope of the expected return of an asset as this risk increases.

    1. If the fraction q {\displaystyle q} of a one-unit (e.g. one-million-dollar) portfolio is placed in asset X and the fraction 1 − q {\displaystyle 1-q} is placed in Y, the stochastic portfolio return is q x + ( 1 − q ) y {\displaystyle qx+(1-q)y} . If x {\displaystyle x} and y {\displaystyle y} are uncorrelated, the variance of portfolio return is var ( q x + ( 1 − q ) y ) = q 2 σ x 2 + ( 1 − q ) 2 σ y 2 {\displaystyle {\text{var}}(qx+(1-q)y)=q^{2}\sigma _{x}^{2}+(1-q)^{2}\sigma _{y}^{2}} . The variance-minimizing value of q {\displaystyle q} is q = σ y 2 / [ σ x 2 + σ y 2 ] {\displaystyle q=\sigma _{y}^{2}/[\sigma _{x}^{2}+\sigma _{y}^{2}]} , which is strictly between 0 {\displaystyle 0} and 1 {\displaystyle 1} . Using this value of q {\displaystyle q} in the expression for the variance of portfolio return gives the latter as σ x 2 σ y 2 / [ σ x 2 + σ y 2 ] {\displaystyle \sigma _{x}^{2}\sigma _{y}^{2}/[\sigma _{x}^{2}+\sigma _{y}^{2}]} , which is less than what it would be at either of the undiversified values q = 1 {\displaystyle q=1} and q = 0 {\displaystyle q=0} (which respectively give portfolio return variance of σ x 2 {\displaystyle \sigma _{x}^{2}} and σ y 2 {\displaystyle \sigma _{y}^{2}} ). Note that the favorable effect of diversification on portfolio variance would be enhanced if x {\displaystyle x} and y {\displaystyle y} were negatively correlated but diminished (though not eliminated) if they were positively correlated.

      Key building block formulae.

      • Start with 'what happens to the variance when we combine two assets (uncorrelated with same expected return)'

      • What are the variance minimizing shares and what is the resulting variance of the portfolio.

    2. Similarly, a 1985 book reported that most value from diversification comes from the first 15 or 20 different stocks in a portfolio.[6]

      the conventional wisdom is that there are sharply diminishing returns to this diversification

    1. This balancing act needs to take into account project complexity (size, distribution, etc.), uncertainty (risk, innovation need, etc.), and the cost of change at the project level and for each major component.
  30. Sep 2020
    1. The challenge is to find a way to live with uncertainty,

      Finding a way to be okay with uncertainty in life is a challenge for many people. I struggle with this as well. But over the last few months I have found various ways to cope with the anxiety caused by uncertainty. Because the world we live in today is full of uncertainties.

    1. Hennessy, E. A., Acabchuk, R., Arnold, P. A., Dunn, A. G., Foo, Y. Z., Johnson, B. T., Geange, S. R., Haddaway, N. R., Nakagawa, S., Mapanga, W., Mengersen, K., Page, M. J., Sánchez-Tójar, A., Welch, V., & McGuinness, L. A. (2020). Ensuring Prevention Science Research is Synthesis-Ready for Immediate and Lasting Scientific Impact [Preprint]. MetaArXiv. https://doi.org/10.31222/osf.io/ptg9j

    1. Siemieniuk, R. A., Bartoszko, J. J., Ge, L., Zeraatkar, D., Izcovich, A., Kum, E., Pardo-Hernandez, H., Rochwerg, B., Lamontagne, F., Han, M. A., Liu, Q., Agarwal, A., Agoritsas, T., Chu, D. K., Couban, R., Darzi, A., Devji, T., Fang, B., Fang, C., … Brignardello-Petersen, R. (2020). Drug treatments for covid-19: Living systematic review and network meta-analysis. BMJ, 370. https://doi.org/10.1136/bmj.m2980

  31. Aug 2020