Tag Archives: hindsight bias

Hindsight Bias Still Dominates Technical Analysis

Hindsight bias, or the tendency to see past events as predictable, still dominates technical analysis even though it has become much easier to check the validity of any claims. I present an example from the healthcare sector and then I … Continue reading

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Trends And Trend-Following Are Not The Same Thing

It is an empirical fact that trends develop in financial price series. But it is also an empirical fact that in recent years profiting from trends has not been easy. People with skin-in-the-game know that trends and trend-following are not … Continue reading

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The Perils Of Naive Portfolio Allocation Schemes

Some books and articles suggest various passive or active portfolio allocation schemes for superior risk-adjusted returns. In most cases the allocations are based on hindsight. Even worse, the statistical significance of proposed portfolios that use ETFs is limited by available … Continue reading

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Fooled by backtested ETF Rotation Strategies [Premium Articles]

Strategies based on ETF rotation schemes are popular. Most of these strategies suffer from hindsight and do not account for market impact. Therefore, they are not statistically significant, i.e., most of these strategies are random. For access to premium content, … Continue reading

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