When we're discussing investment approaches, I think there's a lot to be said for the idea that people are willing to accept some lack of
accuracy if it helps to achieve a degree of
simplicity, and I would hope it's clear that moorfield has consistently put forward his idea of a potential income-investment being too risky if it's currently stated to be yielding over 2-times the current yield of City of London Investment Trust (CTY) in that very light, and as such, I think it's unfair to hold up such a simple idea against a potential '100% data-set' and either dismiss it if that data-set is not available, or to dismiss it if it can't be 'proved' to be 100% accurate every single time, because I think that's attempting to hold up that simple idea to a standard of accuracy that it's not actually intending to deliver to...
I would prefer to consider the '
2-times CTY yield' approach as being similar to the 30mph speed limit on many of our UK roads...
As drivers, we're happy to accept that
simple 30mph speed-limit as being one where
generally, there are detrimental outcomes where that speed limit is broken on such designated roads.
I think that
broadly, most drivers are happy to accept that
simple idea, and the reasoning behind it.
But that's not to say that there has
never been a driver going 32mph on such a road, who
didn't have a detrimental outcome...
Of course there has...
It's also not to say that there has
never been a driver going 28mph on such a road, who
did have a a detrimental outcome...
Of course there has...
And it's also not to say that, as drivers, we expect to be able to see some sort of '100% data-set' where records of every single incident
over and under 30mph has been made publicly available before we're happy to accept the idea behind, and the sensible need for, that 30mph limit...
But even
despite the above accepted inconsistencies in that 30mph speed limit and any data behind it, I think as drivers we're generally happy to accept that it's a
simple, but not 100% accurate method to help guide 30mph road users into following
a broadly safe driving process...
I think moorfield's '
two-times the CTY yield' approach should be seen in a similar light to the above, and with attempts to hold it to a higher statistical standard than it was ever intended for as being nothing more than an attempt to shut down an interesting
and ongoing debate, as can be seen by some of the recent data on this very thread...
https://www.lemonfool.co.uk/viewtopic.php?f=15&t=34915&start=160#p600721Finally, and sticking with the above driving analogy for a moment, I think it's also worth remembering that Ayrton Senna might have had quite a lot to say about someone trying to suggest to him that driving under 30mph helps to remove the risk of bad outcomes regarding his driving, but I think it's also worth remembering that the UK Highways Agency probably never intended Ayrton Senna as being the target audience in this particular debate...
Cheers,
Itsallaguess