Financial Opinion and Insights

Predicting Market Returns May Be A Waste of Time

Jim Lorenzen, CFP®

Jim Lorenzen, CFP®

Last week I wrote about the futility of chasing past performance.   Despite the fact people are continually told not to use past performance as an indicator of future success, an entire industry has been built on trying to get people to do just that.

I thought you might enjoy taking a look at this chart from Morningstar.   It shows the S&P index returns from 1926 through 2010 .  Careful inspection just might lead you to believe – correctly – that investment success is more about process and discipline than predictions.