We caught up with Ed Thorp, an investor who is also widely regarded as the inventor of card counting and the father of wearable computers. In his new book, A Man for All Markets, he aims to do for stock investing what he did for blackjack. Here’s how:
“Donald Trump’s election shocked the nation, but from a statistical perspective, it shouldn’t have. The margin of error in most polls was larger than the difference between the candidates, so the underdog had good chances from a gambler’s perspective. Like polls, markets can be wrong too. As an investor, I constantly watch for where conventional wisdom could miss. Markets are mostly good at predicting outcomes, but very bad at anticipating black-swan events.”
A version of this article appears in the January 1, 2017 issue of Fortune with the headline “When the Markets Screw Up.”
