Many investors think they can predict the future (foresight), by extrapolating the data of hindsight. Foresight that breaks the norm does not come from more profound hindsight. A strategy based on data will, therefore, yield only marginal returns as in many ways, you can still outperform the public as the last greater-fool who is even less astute or informed.
So, yes, data has a marginal investment value. As much as the data of a game of, say, a game of soccer can yield a reliable prediction of the next game being played. Did I say, marginally? Instead, unreliable.
Hence, the reason why many asset management firms play the infamous musical-chair dance around the many asset classes they have under management. One ought not to confound the escapism of the musical-chair game with a renewable investment strategy. You will see the value of asset management “strategies” quickly fall apart when the economic music stops.
And no, GDP is not an accurate measure of the performance of a country as I explained ad nauseam: What is the relationship between Economic Growth and GDP? And other answers provided in this blog.
