Quite possibly. The AJ Bell research only had share-price returns as far as I know.

I suspect discount narrowing wouldn’t have changed the overall result too significantly but it’s hard to know without seeing the actual figures.

I also reckon that the changing make-up of the IT sector, with a lot more alternative assets that often trade at a premium, has played a material part in the average discount figure narrowing over the years.

@Jonathan – Guilty as charged. I normally do mention survivorship bias when looking at numbers like these but for some reason, I forgot to do that in this instance. I’ve added a little note about it now so thanks for the reminder 🙂

As for picking future winners, this is certainly no short cut of course. It shows you what has worked in the past so I reckon it can help you narrow the odds in your favour a little. How much narrowing it does is certainly open to question.

Lovely article, but it almost carried me away with enthusiasm, before I realised that we still don’t know how to pick the future winners from the future losers (hello, Mr. Woodford!)

@GI – Yes, generally the earlier you invest the better, given that markets tend to rise over time. That’s assuming you have the cash available to do so, of course. Putting the money into an ISA gives you a tax advantage as well (especially when you get into the millions!) but then the sums become more complicated.

@Ian J Bates – That’s true, it was plain old Standard Life that took over from Edinburgh in 2003 and the merger forming Aberdeen Standard didn’t take place until much later in 2017.