A financial adviser once made a presentation to my husband that illustrated how our money invested with his firm (one of the largest financial institutions in the country) would grow over the course of the next 10 years. This projection indicated the trajectory of this growth and even indicated the investment balance each year into the future. This adviser concluded his sales pitch by saying that everything would be fine and he’d take care of our family.

I didn’t like the idea of handing my money over to this guy to manage. He had put together projections using the past performance of certain mutual funds. But past performance doesn’t predict future performance.

The adviser didn’t show him his track record in managing a portfolio or explain his rationale in choosing these mutual funds. I was pretty sure I could identify great-performing funds and then calculate future returns based on those funds’ past performance. Actually delivering returns on investments for the unknown future would be difficult. But picking winners from the past, well, that seemed pretty easy.