Few investors would ever disagree with the disclaimer that accompanies most investment returns - 'past history is not necessarily a guide to future performance'. However, even fewer investors would disagree with the statement that historical returns provide us with the only source of data available for making realistic predictions about the future. In 1989, Ibbotson and Sinquefield published a definitive paper on the historic performance of the US markets - dating back to 1926. According to the researchers, the re-creation of a very long-term historical time series is required to capture ALL types of events.
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