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A Quick Appreciation of the Sharpe Ratio

The current state of the global financial markets has gotten more people than usual worrying about the technical aspects of finance. One method for reasoning about investment returns and risk is a tool called the Sharpe Ratio. It is well worth reviewing this measure and seeing how, if used properly, […]

How Market Designs Set Prices

Hal Varian (Chief Economist, Google) recently shared a concise article with the title “How auctions set ad prices”. The article is a clear exposition of how ad prices determine the sorting order of bidders for online advertising. However, the tone of the article is not quite compatible with how it […]

Betting Best-Of Series

Betting Best of Series is a new expository paper describing the mathematics involved in betting on something like the United States’ Major League Baseball World Series. It isn’t so much about baseball as about demonstrating some of the really great ideas from mathematical finance in a simplified setting. This sort […]

Is Search Advertising a Market for Lemons?

author: John Mount, 5-13-2008 Anand Rajaraman recently wrote a very thought-provoking entry on his Datawocky blog. He asks “Is Search Advertising a Giffen Good?” As he explains a Giffen Good is a sort of economic doomsday machine that some segment of consumers are forced to buy more of an inferior […]

Sorting Used in Anger

“Sorting Used in Anger” (A rambling glimpse into the mind of a theorist) Author: John Mount 4-24-2008 The other day I had a bit of time to kill before an appointment. Luck was with me: there was a nearby bookstore and I was able to pass some of the time […]