#The claim is incorrect due to a broken frame.

###Analogy: Did one employee do 90% of a small operation's work?

###Corrected claim: Investing on the top-10 best days would yield a ~64% return.

###Discussion: Mathematical explanation.

The claim is incorrect due to a broken frame.

Analogy: Did one employee do 90% of a small operation's work?

Corrected claim: Investing on the top-10 best days would yield a ~64% return.

Discussion: Mathematical explanation.

For example, going by Wikipedia's numbers, it looks like an investor who skipped the worst-5 days would've applied a ~79.4% factor to their wealth. But does it make sense to attribute ~79.4% of wealth to skipping the worst-5 days while also attributing 63% of the wealth to being present for the best-10 days?

For example, going by Wikipedia's numbers, it looks like an investor who skipped the worst-5 days would've applied a ~79.4% gain to their wealth. But does it make sense to attribute ~79.4% of wealth to skipping the worst-5 days while also attributing 63% of the wealth to being present for the best-10 days?

The problem's that the frame's broken. This is, it doesn't make sense for Bob to describe his participation in 90% of the projects as having represented 90% of the company's work. It's not that he did the math wrong, it's that the logic behind the model itself is a tad silly.

1. The factors aren't totaled over all days.
   If someone wanted to make a claim like this, then they should've ln(factor)'d all of the days, then added those up, then divided that total by the sum of the ln(factor)'s for the top-10 days.

2. The factors contain negatives.
   Some days ended lower than they started. For example, apparently 1987-10-19 had a −20.47% hit, for a ln(factor) ~= ln(1-0.247) ~=-0.231553819. In general, for any factor of less than 1, ln(factor) should be negative.

1. The factors aren't totaled over all days.
   If someone wanted to make a claim like this, then they should've ln(factor)'d all of the days, then divided the sum of those parameters for the top-10 days by the sum of those parameters for all of the days.

2. The factors contain negatives.
   Some days ended lower than they started. For example, apparently 1987-10-19 had a −20.47% hit, for a ln(factor) ~= ln(1-0.247) ~= -0.231553819. In general, for any factor of less than 1, ln(factor) should be negative.