My Love/Hate Relationship With ‘Past Performance’
“Past performance is not indicative of future results.”
Sound familiar? If you have invested in any regulated investment of any form, you have read or heard this phrase before. I have to be honest. Even as a professional advisor, when I read this and explain it to clients there is something about it that gets on my nerves. Don’t get me wrong, I’m not saying it’s untrue or that I don’t believe it. We don’t know what the future returns of our investments are going to be. We don’t know the exact short-term direction of an investment, and if anyone tells you that they do, you should find another advisor because you will be set up for failure.
If I really think about why this phrase annoys me, I think it is because I want to find some certainty with an investment’s outcome. Doesn’t everyone? > SEE MORE
Pete Dixon, CFP®
Partner and Advisor