Sunday, September 11, 2016

Quantification of Religious Conviction vs. Religious Conviction to Trading

I've asked myself a similar-themed question since I was about 10 years old without quite being able to express it in a simple sentence, but alas here it is:

Can God be gamed?

Ok, that's definitely a nebulous and perhaps even offensive question that must be explained. Regardless of your religious denomination, most religions seem to have the concept of good and bad, and that good deeds are "rewarded" in some form while bad deeds are "punished." The weight of good deeds and bad deeds, however, seem to be in question, i.e. they're not quite laid out in the Bible, Torah, Quran, Vedas, etc...

One can only think that this was a bit intentional by the Creator for the simple reason that people would probably game the system by doing just enough good deeds to outweigh the bad ones so as to make it to heaven or whatever positive outcome one's religion declares (state of "Nirvana", anyone?).

You also hear contradictory things from religious figures (surprise, surprise) who on one hand tout that doing certain things are either highly praiseworthy or deadly sinful (implying a sort of weighing factor in the eyes of the Creator), but on the other hand state that one must simply be genuine and consistently try the best to one's ability to do good in order to ultimately achieve post-mortem success.

In trying to un-crack the code of religious right of passage to the Promise Land, Blaise Pascal famously determined the rational and "smart" thing to do was to live one's life as if there was a God who was to judge you based on your worldly deeds, based on his risk assessment of the outcomes of contrasting scenarios (i.e. huge risk with limited reward if you act immorally in the face of there being a God, but healthy risk mitigation without too much reward reduction by acting morally).

In a sense, Pascal's Wager, as it's known, is trying to game God. It's living one's life without true conviction, but with a quantitative approach to maximizing one's returns given the probability and risk/reward of different scenarios. Is this really the right way to go about doing things, much the same way a trader or entrepreneur might try to mitigate risk and maximize rewards with certain actions and rules?

Another interesting question might be, if true conviction and emotional devotion is the way to go, would an entrepreneur or trader actually benefit from tapping into this somehow and allowing the power of the mind, body, and spirit to do its thing rather than relying on our more quantitative, logic-based trading rules and styles?


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