alt Hacker NewsYou should backtest this strategy over the last 20 years before you make serious decisions off of the vibe from internet comments
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alasdair_ • today at 2:13 AM
Why 20 years? Just because we know, post hoc, the usa outperformed other places in the last 20 years, in no way means the next 20 years will be the same.
If you want a different point to backtest from, try Japan in the 80s and early 90s
ai_slop_hater • today at 2:00 AM
What's the point of backtesting? Does backtesting say anything about the future?
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20 years is not enough.
If you just look at the past 20 years, the US has had exceptional returns compared to the rest of the world.
The thing is, historically, high PE ratios like what we're seeing in the US do not correlate with short term returns that are as high. Expected future returns decrease as the PE ratios go up in a pretty linear fashion.
https://am.jpmorgan.com/us/en/asset-management/institutional...