So I understand that the Fama-French factor model relates a stock's excess return with its beta, market cap, and book to price. How does one use the model in practice? Do people assume that market cap and book to price are fixed (use today's values), and then just supply an estimate for next period broad market return and basically predict future stock return using expected broad market return with some adjustment for market cap and book to price?
Would one supply estimates for future market cap and book to price as well? This seems to be difficult as market cap and book to price are all dependent on price, which will be dependent on return, which is your response.