What is the theory of reflexivity? How does it function? - InvestMentor - 0 views
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investmentor on 01 Mar 23The Theory of Reflexivity connects the trader's perceptions and market's actuality through a self-fulfilling loop. It may result in price movements that consistently and noticeably depart from the equilibrium price. The successful investor and philosopher George Soros think that stock market volatility results from the shifting opinions of all investors. He contends that these impressions are more influenced by how people perceive reality, which is affected by many macroeconomic and psychological aspects, than actual events. Then again, what exactly is this General Theory of Reflexivity? What benefits does it offer traders? What are the theory's lessons, exactly?