How accurate is the Value Projection tool?
According to this analysis, I should reach my target of ÂŁ1.09 million after the following conditions:
- Monthly input of ÂŁ1500
- Duration: 16 years
- Reinvest all dividends
I’d like to know what it’s based on too. Judging by some of the crazy projections I’ve seen it looks like it’s based on the last year’s data only. So maybe not too accurate. Lot of stocks went up 100%+ after the pandemic.
Some guy here got a projection of something like ÂŁ26 Billion Trillion
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Last 5 years but will be extended eventually. Everything is very positive since everything’s gone up like crazy in past 5 years
I dislike this projection, misleading, especially for new investors. Past performance by no means projects to future performance.
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Especially when you see what doubling your rate of return does (£200 vs £15 a month for £1M over 45 years) Might convince some to put less in because you don’t need to
And also makes people change their weighting’s to stocks that increase their return, even though it’s based on past performance
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It’s based on past 5 years iirc, and yes 26 billion trillion going all in on GGP. ZM would have gone even higher.
Past performance doesn’t mean diddly squat on how future performance will go though, so they are just to give you an idea of how it could go if it keeps up the same trend (which it may, may not, probably won’t, definitely won’t - depending on what stock it is).
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