The End of Probability: A new way of thinking about derivatives — with Elie Ayache

Every once in a while, you meet someone and you just look in the mirror and think: hey, I’m not worthy. What am I doing with my life?

Today’s guest Elie Ayache is part entrepreneur, part philosopher, and part technologist.He takes aim at Taleb’s Black Swan model (and in general our view of probability and market pricing) and provides a new model of how to view contingent claims and their relationship with the market’s pricing mechanism. He walks the talk, growing and expanding his software firm’s client base with institutional investors.It’s possible that with time, his software and theory will have a significant impact on how contingent claims are viewed, priced and traded.

We discuss his new book, The Blank Swan: The End of Probability.  I learned a ton about how this all works (even if I didn’t understand everything Ayache spoke about). Continue reading “The End of Probability: A new way of thinking about derivatives — with Elie Ayache”