Sensible Investing Logo


  • Description
  • Share

Acuity 45: Forecasting the investment weather

October 22, 2018
Share your comment

‘Expected’ returns on portfolios are a little like the ‘expected’ weather in the UK. We have a growing wealth of data, science, models and common sense on which to build forecasts in both areas. Yet despite generalisations - such as it’s usually sunny and warm in the summer and cold and frosty in the winter - we all know that the day-to-day, month-to-month and even year-to-year variation is high.

Investors should never believe that expected returns – like the weather – are accurate, single point, consistent outcomes. Generalisations, grounded in empirical data, sensible rules of thumb and common sense are immensely important starting points for useful, informed discussion and scenario modelling.

Download Document

Share this

Please share this content using any of the share buttons below. Please see this page for guidelines on embedding videos and other content in your own website or online marketing.