Guru Stock Market Forecasting Grades
Can experts, whether self-proclaimed or endorsed by others (publications), provide reliable stock market timing guidance? Do some experts clearly show better intuition about overall market direction than others?
We have accumulated reviews of the public U.S. stock market forecasts of various investing/trading experts for over a year. With over 2,800 measurements for 37 gurus, including bulls and bears and technicians and fundamentalists, we have critical mass for: (1) assessing the forecasting acumen of the stock market gurus as a group; and, (2) ranking experts according to the accuracy of their past forecasts. This kind of forecasting ability is different from, but may be related to, stock picking expertise.
Note that the overall assessment of the stock market forecasting ability of experts in aggregate is far more reliable, based on sample size and duration, than the evaluations of individuals.
We update this page and the underlying guru forecast database about weekly.
SNAPSHOT
We restrict reviews to publicly available material, putting ourselves in the place of an individual investor trying to locate value in the marketplace, and mindful of concerns about copyright and trade secrets. Sometimes we find public records on the web sites of the experts themselves and sometimes on web sites of other parties. This approach helps keep a level playing field for reviews, and it allows readers to check the reasonableness of our judgments should they choose to do so.
The following table (last updated 12/30/06) summarizes the results of our reviews of the publicly available forecasts of 36 experts regarding the future direction of the overall U.S. stock market. For each expert, the table shows the total number of measurable forecasts, the numbers of forecasts we judge to be essentially right and essentially wrong, and the accuracy rate. Accuracies range from a low of 26% to a high of 71%. The overall accuracy of the entire group is 48% (1,384/2,876). The average accuracy of the group (weighting each expert equally) is 50%. These overall results are perhaps consistent with the Efficient Markets Hypothesis.
See the Notes below for cautions on interpreting the grades of individual experts. |
