Captain's Quarters

[JD400]

This Day in Financial History. . . .
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Learn what happened in business in today’s past


February 16:

1990: Cisco Systems, Inc. goes public on NASDAQ, selling 2.8 million shares at an initial offering price of $18 per share. By the end of the decade the stock has increased in value by more than 30,000%.

Corporate communications department, Cisco Systems.

1822: Francis Galton is born near Sparkbrook, England. After studying medicine, exploring Africa and obsessively measuring everything he can find, he develops the statistical concept of "reversion to the mean," or the inevitable tendency of above-average results to be followed by below-average results (and vice versa). If investors understood nothing but this one concept, they would make (and keep) a lot more money.

Peter L. Bernstein, Against the Gods: The Remarkable Story of Risk (John Wiley & Sons, NY, 1996), pp. 152-168; http://en.wikipedia.org/wiki/Galton