Someone new to investing tried to compare the performance of two Canadian bond ETF ZAG and ZFL. He checked the past 12 months graph and said they look very similar. I suggested that is far from enough and suggested him to check longer history.
He checked the whole history since launch and still can’t find the big difference. I reminded him that the length of the history can be very difference because they probably have very different launch date.
The key is to identify economic cycles such as recession, inflation, expansion, etc. and see how each perform in the same economic cycle.
The most recent recession was 2020 triggered by pandemic. After that, it was recovery and expansion until December 2021 when inflation started to crash the financial market. Those periods provide very rich data points for us to compare different securities’ performance.
Hope you find many discoveries and insights. Have fun!