I was given the following assignment:

QUESTION 3.

1. Gasgard is a country which is going through a historical structural change in its economy. Experts are very confident in stating that the economic situation in Gasgard will not change for the next five or ten years. Lokey, a stockbroker, gives his clients the following advice:

Avoid making any investments in Gasgard stocks (via Heimdal the national stock exchange of Gasgard), because the expected returns of stocks are believed to be below the historical average for the next five to ten years.

Is Lokeys advice sensible? Explain.

And answered:

"Yes, Lokey's advice is sensible. When stockbrokers, economists, and financial managers estimate the expected return of stocks, they do so to determine whether a client's investment is anticipated to have a negative or positive average net outcome. The expected return calculations are often based on a review of historical return data and past performance of an index such as the S&P 500 or Nasdaq Composite, which is used as an indicator of the economic development of the U.S. equity market and in measuring market performance. Historical returns are also useful in relation to risk as they can be used in calculating the standard deviation of returns of a share and in estimating where the future data points may fall in connection to standard deviation. A review of historical returns can provide insight into how the market has previously reacted to structural changes in the economy. However, investors should not blindly use historical data returns in predicting future returns and instead bear in mind that the older the historical data is, the less likely the chances of it successfully forecasting returns in the future."

Is this correct? And how can I improve the answer?