Data mining---the process of looking at large amounts of historical data and finding patterns. But are historical patterns meaningful for predicting future results? For example, Wednesdays have historically been the best days of the week for stocks. But in the absence of an exact 5-way tie, one out of the five weekdays has to have been the best day. CNBC said that the last five trading days of the year are historically superior to other five day periods by about 1%. Is this data mining? We have three days left to see how it works out this year.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
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