Why should the past have the slightest predictive power for the future?

E

easymon1

Good Question D.A.C.
Why should the past have the slightest predictive power for the future?
from
https://www.elitetrader.com/et/thre...enarios-for-back-testing.358699/#post-5385576
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Which brings us to crypto.
Crypto has short term probabilities only.
Hodlers may get more than heat, depending on when they bought.
 
The sun will rise, gravity will still be here and the markets will churn, people will want easy money and fools and their money are easily parted.

The world has a lot predictability. It is those who can't see or work with it, claim it is not there. Remember "spontaneous generation"?
 
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easymon1 said:
Good Question D.A.C.
Why should the past have the slightest predictive power for the future?
from
https://www.elitetrader.com/et/thre...enarios-for-back-testing.358699/#post-5385576
View attachment 258975
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Factor based investing seems to have some predictive power. Size factor where smaller market cap stocks tend to outperform, also momentum, i.e. stocks that have appreciated most over the last 12 months tend to higher returns over their cohort that has risen the least, so on for other factors (cf. Fama French 5 factor model etc.). Of course, harnessing this outperformance isn't considered "alpha" anymore since academics have reduced it to a formula but it has been predictive.

As to the why, who knows. It's a statistical phenomenon like IQ or social outcome across populations. Root cause indeterminate, obviously just as debatable, yet still it shows in the numbers.
 
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Because human emotions today might be just slightly (or more) similar to the way they were in the past?

Seriously, who is letting these new guys in here with this dumb shit? Go short some GME, wait for a month.... THEN we can talk...
 
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