Modern finance · 1950s–1990s
1988–2002
Experts against darts
A newspaper pits professional stock pickers against darts thrown at the stock pages.
From 1988 to 2002 The Wall Street Journal ran its Dartboard contest: staff threw darts at the stock listings while professionals chose their own picks, and the results were printed months later.
The pros won more often, but researchers found that much of their edge came from the boost of being named in the paper and from picking riskier stocks.
💡 Why it made sense then
Burton Malkiel's 1973 book had claimed a blindfolded monkey with darts could do as well as the experts, and readers wanted to see it tested.
Ideas it gave us
- 🧺 Random walk
The random walk idea says short-term price moves are unpredictable, like a series of coin flips, so a portfolio picked at random can do about as well as one picked by experts, and most investors are better off owning the whole market cheaply.
✏️ Suggest an edit🕘 Edit history
Practise with $10,000 in play money
Free. No real money involved.