Skip to Content

What the Father of Card Counting Has to Say About Investing

Edward Thorp's book "A Man For All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market."Edward Thorp's book "A Man For All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market."
Edward Thorp's book "A Man For All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market."Courtesy of Random House

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.”