One of the many nuggets of wisdom from Fooled by Randomness by Nassim Taleb – I wish I am capable of coming up with such stuff. Assume that you have an investor who is capable of earning a return of 15% with a 10% volatility. It means that out of 100 sample paths, we expect close to 68 of them to fall within a band of plus and minus 10% around the 15% excess return. A 15% return with a 10% volatility translate into a 93% probability of success in any given year. But seen on a narrow time scale, this translates into a mere 50.02% probability of success over any given second. A minute by minute examination of his performance means that each day (assuming 8 hours a day) he will have 241 pleasurable minutes against 239 pleasurable ones. These amount to 60,688 and 60,271 respectively, per year. ......