Morgan Stanley Investment Management - Mon, 08/12/2024 - 12:30

Pattern Recognition: Opportunities and Limits

We explore the powers and perils of pattern recognition, which investors often cite as a basis for action.
While it can be powerful when applied appropriately, it can also be misleading and lead to overconfidence.
We define pattern recognition, discuss when it tends to work well, review why it may be misleading, and offer ways to help improve it.
Pattern recognition tends to work well in stable environments where cause and effect are clear and feedback is effective but poorly where causality and feedback are limited.

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Morgan Stanley

Morgan Stanley Investment Management’s Insurance Solutions team proudly supports our insurance clients with bespoke investment solutions and a comprehensive range of strategies that align well with insurers’ investment objectives and risk tolerances. We provide risk-based capital efficient solutions across public and private market strategies, and add value through thought leadership across insurance research, portfolio management, strategic asset allocation, reporting, risk management, and rating agency/regulatory considerations.

Joel Cramer, CFA
Managing Director, Head of North American Insurance Solutions
joel.cramer@morganstanley.com
Office: 312 706 4216
Mobile: 630 222 6765

www.morganstanley.com

1585 Broadway,
New York, NY 10036

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Pattern Recognition: Opportunities and Limits

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Morgan Stanley Investment Management

Morgan Stanley

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