There is truth to it, but vanguards real outperformance came from its extremely low fees. It has funds that only charge 7bps/year!
I've seen similar curves trouble is they are calculated based on realized profits/losses and arent MTM - marked to market - .
. I am very skeptical about back tests , especially with trending , t/a and price action .There are several factors which affect actual results 1)emotions , stress , psychology 2)mistakes 3)fills on prices 4)cognitive blindness I hope I know enough to make it work in real , but I have also devised a " more mechanical method". I hope I can make it work on real time , but it depends on the quality of people I hire to do the job. old t/a system failed Every week our system makes 100 to 200 pips , but we lose money every week after expenses , because we make many stupid mistakes
Very strict risk management, I am also often hear suggestion from expert that he gave speech on seminar forex will better manage strict risk less than 2 % each plan trading with making more opportunities hopefully will get more winning trades
Good point. Fees can certainly erode gains, even with the "buy and hold" type. Bogle's commentary is fairly critical regarding not only fees but also the trading commissions one will incur over the course of their trading career. This is why he constantly stresses index investing (via Vanguard's mutual funds or ETFs, of course).