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WalterL comments on A hypothetical question for investors - Less Wrong Discussion
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Mockingjay up in here, with this crystal ball the odds will be ever in our favor.
Buy every day when you've got good odds (more likely to make cash than lose it) to make money tomorrow. Sell every day you start the day owning stock.
Every 2 days you lose 4 dollars in transaction fees. You also gain/lose money equal to the difference in cost between your initial purchase and sail. Since you know the pdf for the outcome, and only play if the odds are in your favor you'll probably make a killing.
1) You neglect to account for the transaction fees - following your model would tell you to spend $4 on fees to capture a $1 gain.
2) Why on earth would you auto-sell the stock without even checking the crystal ball?
Yeah, you are right. I commented off the cuff.