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Two Famous Investment Quotes That Are Actually B.S.
Always remain skeptical
Investors love pithy sayings that speak the truth about the market.
We often hear quotes from Warren Buffet, Ray Dalio, and others, bandied around as if they hold biblical significance.
But do these statements actually hold water in practice…?
1. Past performance is no indication of future results
Possibly the most misused and misquoted statement in all investing.
The actual statement, which is used by the SEC is:
Past performance is no guarantee of future success
Note the word guarantee.
Of course, we cannot look at an asset and guarantee future results based on past performance. If this were possible everyone would be rich.
However, this statement has been misquoted all over the internet as “past performance is no indication of future results”.
This is clearly nonsense.
The whole basis of technical analysis is that the past tells us something useful in both short and long-timeframes. It’s not about guaranteeing anything, it’s about looking at probabilities…
