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.
Austin Smith owns shares of Apple and Google. Fool contributor Morgan Housel has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Bank of America, and Google. Motley Fool newsletter services recommend Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.