Demographic research is not a common part of most investors' portfolio or retirement planning. Should we really focus on it?

Consider the research paper out of the University of California by DellaVigna and Pollet. In part it concluded,

“Taken as a whole, the evidence suggests that changes in age structure of the population have the power to influence consumption demand in a substantial and consistent manner. Demographic Trends forecast above average returns for industries that are favored by age-consumption data. Investors do not take advantage of this.”

“What people THINK happens is the Efficient Market Hypothesis. What really DOES happen is Inefficient distribution, understanding, or comprehension of important data.”

“Demographic Trends forecast above average returns for industries that are favored by age-consumption data.”

“Investors do not take advantage of this.”

REMEMBER, that your retirement is the only thing you have to risk by ignoring demographic assumptions. Do you want to take that risk?