Mathematicians Against Fraudulent Financial and Investment Advice (MAFFIA)


This site was created out of growing concern with the usage of less-than-fully rigorous mathematical and statistical methodologies in the financial/investment world. One example is the increasing prevalence of backtest overfitting, due in part to the ease of generating large numbers of model variations (more than statistically justified) using modern computer technology. Indeed, such statistical errors are likely the primary reason that investment strategies which look good on paper often fall flat in practice.

We are also concerned with the proliferation of quasi-mathematical investment advice and financial columns in the past few years, which appear to be based on sophisticated mathematics and statistics, but which, upon more rigorous analysis, are at best questionable. We encourage the reader to search the Internet for terms such as "stochastic oscillators," "Fibonacci ratios," "cycles," "Elliott waves," "Golden ratio," "parabolic SAR," "pivot point," "momentum," "technical indicators," and others in the context of finance. Although such terms clearly evoke precise mathematical concepts, in fact, in almost all cases, their usage is scientifically unsound.

It is particularly disappointing that such pseudo-mathematical language and techniques are being promoted by leading financial and brokerage houses. Again, the reader is invited to log in to his or her own brokerage service and search for terminology such as those listed in the previous paragraph in the broker's analysis of various stocks, bonds, mutual funds and exchange-traded funds. The fact that these brokers have a vested interest in their customers' frequent trading makes such commentary particularly galling.

Historically scientists have led the way in exposing those who utilize pseudoscience to extract a commercial benefit. In the 18th and 19th century, physicists exposed the nonsense of astrologers, and beginning in the 20th century governments started requiring strict double-blind scientific tests, with rigorous statistical standards, of all pharmaceutical products. Yet mathematicians in the 21st century have remained disappointingly silent with the regards to those in the investment community who, knowingly or not, misuse mathematical techniques such as probability theory, statistics and stochastic calculus. Our silence is consent, making us accomplices in these abuses.

This blog and website were established with these concerns in mind. Our research and writings focus on ways to better understand and mitigate these difficulties, ways to assist other professionals in the field, in addition to rigorous, unbiased testing and analysis. If you identify with our concerns, let us know and spread the word. Together we can make a difference. Contact us at

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