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<p>[QUOTE="medoraman, post: 1687006, member: 26302"]Yeah. I find 1980 too often either overplayed or underplayed depending on what service someone is trying to sell you. Any performance analysis showing 1980 results as an expected outcome is by definition not worth the paper its printed on. Lucky for them they are not wasting good paper here, just 1's and 0's.</p><p><br /></p><p>This is just a case of backfitting. What is the reason they chose the start and end dates in this analysis? Simply because it suited them, no other reason is given. Very common way of misleading someone. Most people aren't critical enough of such analysis. If this paper had been turned into me for a MBA Finance class, I would give it a C+, (which for graduate school is not very good).</p><p><br /></p><p>For everyone reading such papers, (and I do too), the key is always the assumptions the writers make. You have to ALWAYS challenge those assumptions or risk being seriously misled. Why was 1971 chosen as the start date, why was 2008 bottom chosen as a start point? Why wasn't Hunt's short mentioned and shown? Bottom line for this article, they are taking an arbitrary start date and ending at an absolute historical high, (which they do not tell you about), and now starting at an absolute low for the past decade and somehow showing you this "correlation" and leading you to believe the market will go similar to 1980. Way too much manipulation of dates for me to really research their other assumptions much more. Cherry picking dates without explaining WHY the dates are appropriate, and showing the reader the whole dateline so they can judge for themselves if its cherry picking, is probably the #1 way to manipulate an analysis. </p><p><br /></p><p>Too bad, I would have liked to read such an analysis if performed properly and not intentionally misleading.[/QUOTE]</p><p><br /></p>
[QUOTE="medoraman, post: 1687006, member: 26302"]Yeah. I find 1980 too often either overplayed or underplayed depending on what service someone is trying to sell you. Any performance analysis showing 1980 results as an expected outcome is by definition not worth the paper its printed on. Lucky for them they are not wasting good paper here, just 1's and 0's. This is just a case of backfitting. What is the reason they chose the start and end dates in this analysis? Simply because it suited them, no other reason is given. Very common way of misleading someone. Most people aren't critical enough of such analysis. If this paper had been turned into me for a MBA Finance class, I would give it a C+, (which for graduate school is not very good). For everyone reading such papers, (and I do too), the key is always the assumptions the writers make. You have to ALWAYS challenge those assumptions or risk being seriously misled. Why was 1971 chosen as the start date, why was 2008 bottom chosen as a start point? Why wasn't Hunt's short mentioned and shown? Bottom line for this article, they are taking an arbitrary start date and ending at an absolute historical high, (which they do not tell you about), and now starting at an absolute low for the past decade and somehow showing you this "correlation" and leading you to believe the market will go similar to 1980. Way too much manipulation of dates for me to really research their other assumptions much more. Cherry picking dates without explaining WHY the dates are appropriate, and showing the reader the whole dateline so they can judge for themselves if its cherry picking, is probably the #1 way to manipulate an analysis. Too bad, I would have liked to read such an analysis if performed properly and not intentionally misleading.[/QUOTE]
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