This page provides a running tally of stock market forecast accuracy. If other, larger studies are any indication, it will eventually settle on a 50% accuracy rate, same as a coin toss.
It’s important to understand that stock market forecasters cannot add value to your investing performance. Acting on their hunches will reduce your profit. It’s best to call them something that reminds you to ignore them: Z-vals.
The term z-val (“zee val”) is a shorthand introduced in The 3% Signal for “zero-validity forecasters” and “zero-validity environment.” The latter phrase was coined by Nobel Prize winner Daniel Kahneman in his book Thinking, Fast and Slow, where he wrote that “stock pickers and political scientists who make long-term forecasts operate in a zero-validity environment. Their failures reflect the basic unpredictability of the events that they try to forecast.”
The table below lists forecasts as they’re added. Accuracy is displayed once a z-val has at least one forecast tracked. Recent forecasts are shown below the table. For a complete history, see the Z-val Zone Judgment Schedule.
The purpose of this page is not to harm anybody’s reputation, but to show investors that guessing games don’t work. Click on some of the names below. Read their convincing forecasts. Notice:
1. The list of worries is a repeating one.
2. Bearish forecasts are usually wrong.
3. The way to win is to remain invested.
Once you understand that forecasting is unhelpful, join me in looking only at past prices instead of guessing future ones. It will boost your performance and lower your stress.
To beat the market using a proven forecast-free system, please sign up for The Kelly Letter.
Total Forecasts: 42 | Judged Forecasts: 35 | Right: 9 | Wrong: 26 | Group Accuracy: 26%
“The market may be finally realizing that there are limits to what the Central Banks are able/willing to do to keep this gravy train going. On Friday we saw the Dow drop 394 points on the HINT that we may be coming to an end to the stimulus both here and in Europe. … “Without the […]
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In a cheerless missive to investors, Paul Singer at Elliott Management warned that the bond market is broken and that once central banks lose their ability to prop it up, the crash will be big. This is a recurring bearish argument, but always popular. Singer says now is “in many ways the most peculiar period […]
Marc Faber said on CNBC’s Trading Nation that the stock market could “easily give back five years of capital gains, which would take the market down to around 1100.” Getting to 1100 from the S&P 500’s Friday, August 12, 2016 close at 2184 would require a 50% crash. It’s not clear what has Faber so […]
Noting the recent run-up in the benchmark Standard & Poor’s 500 index while economic growth remains weak and corporate earnings are stagnant, Jeffrey Gundlach, the chief executive of DoubleLine Capital, said stock investors have entered a “world of uber complacency.” … “The artist Christopher Wool has a word painting, ‘Sell the house, sell the car, […]
Fourteen years ago, the author of a series of popular personal-finance books predicted that 2016 would bring about the worst market crash in history, damaging the financial dreams of millions of baby boomers just as they started to depend on that money to fund retirement. Broader U.S. stock markets are recovering from the worst 10-day […]