Give Up: You Can't Predict the Market

Analysts at Vanguard recently looked at stock market data going back to 1928. What they found was important for all investors: Metrics that we pay a lot of attention to -- GDP, earnings growth, dividend yields, estimates of earnings growth -- tell you very little about what the stock market will do over the following decade. Almost nothing, in fact. 

Amazingly, rainfall, which should be irrelevant to stock market returns, was a more helpful metric to follow than analysts' projections of earnings growth.

In this video, Fool columnist Morgan Housel and Austin Smith discuss why the market is so hard to predict and what it means for investors going forward.

If you're looking for solid, simple companies for the long run, let me invite you to read the Fool's brand-new special report: "The 3 Dow Stocks Dividend Investors Need." It's free. Just click here to get your copy today.


Read/Post Comments (0) | Recommend This Article (9)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2150643, ~/Articles/ArticleHandler.aspx, 12/22/2014 8:29:41 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement