The value of Good Explanations

I am a firm believer in the value of good explanations, and I’d say a lot of my time is spent on finding the right explanation or intuition for a process or event (this blog itself is an example).

Rather like a good user interface, a good explanation can be the difference between a success and failure in a project. Here are some qualities of good explanations:

  • they are intellectually satisfying when you find them,
  • they allow you to reach out to a larger audience than just your fellow specialists, and therefore are a better way to have an external audit of the work you are doing,
  • they can show the direction your research should go,
  • a good explanation of a trade/model/etc inspires confidence in your traders & clients that you know what you are doing and are taking care with their money.

The key to all this is that:

finding a good explanation is about asking the right questions

and that itself is the basis of good research.

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