This is a truly EXCELENT book on Bayesian statistics, frequency statistics, risk, and uncertainty.

It has clarified my thoughts on my own research. We need to know when models are working and when they are failing. The deviation statistics measure when LCRT valuation models are working and when they are not. As long as stock prices remain within Rawley Ranges of Bounded Rationality, both the valuation model and the price dispersion model are working. When prices fall outside of these ranges, something is WRONG! The models are not working. Either the structure is incorrect, the models are missing relevant variables, or a Black Swan uncertain event never seen before has occurred. (Frank Knight’s definition to distinguish risk from uncertainty is most relevant here.)

It all fits together!

I wish his Chapter 10 had covered Benoit Mandelbrot’s research on fat tailed distributions and associated frequency risk measures. He might have referenced Bart Madden’s work on System Thinking and associated research into continuous improvement based on feedback from the data.

Review Originally Written for the Book Club of the CFA Society of Chicago where I serve on the Education Committee.

Rawley Thomas

Co-Editor of: The Valuation Handbook: Valuation Techniques from Today's Top Practitioners.

Co-Author of: ValuFocus Investing: A Cash-Loving Contrarian Way to Invest in Stocks

**精装****语种：**英语**ISBN:**0691133611**条形码:**9780691133614**商品尺寸:**16.5 x 2.5 x 23.5 cm**商品重量:**567 g**ASIN:**0691133611**用户评分:***12 买家评级*

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