Zero-Sum Games: It's All About Information Warfare
2025-02-24
In zero-sum games like poker and quant trading, information asymmetry is key. The game-theoretic optimal (GTO) strategy isn't always best, as it assumes all opponents play rationally. Success hinges on identifying exploitable patterns in opponent behavior while concealing your own strategy. High-frequency trading firms might profit from predictable patterns in competitor algorithms, while those algorithms defend by adding randomness to their trades. This mirrors poker's table image; players can mislead opponents by creating a false pattern of behavior, ultimately profiting. Zero-sum games are fundamentally information warfare, not just a pure strategy contest.
(rohan.ga)