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Milk and Peanuts: Past Performance Is Not a Reliable Indicator of Future Performance
Financial services has its own “milk and peanuts” warnings. Part IVA could apply to many actions if the Commissioner wished, and ASIC’s rule that “past performance is not a reliable indicator of future performance” is often true: markets revert to trend, and fund outperformance is frequently statistical noise. Even when real, changes in staff or strategy can make past results irrelevant.

Dennis Barton
Dec 34 min read
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