Member-only story
Money: See 2025’s Pro Forecasts for the Market — Should You Care?
The pros keep making market forecasts, but how accurate are they, and what’s the best way to use them?
It’s my favorite quote.
Not least of which because it’s often misattributed to Yogi Berra, which makes me smile…
“It’s hard to make accurate predictions, especially about the future.” — Nils Bohr, Danish physicist and 1922 Physics Nobel laureate
Experts Rush in Where Angels Fear to Tread
Paraphrasing the well-known proverb, it seems investment experts keep making market forecasts, despite Bohr’s above-mentioned admonition.
But maybe they’re just that good.
Or are they?
In a short and highly readable post, “Be skeptical of stock market predictions for the coming year,” Mark Hackett, CFA, CMT, claims they aren’t, and backs it up with data.
The following table shows Hackett’s average forecast data, actual annual S&P 500 total returns from SlickCharts, and their differences and absolute differences (e.g., a negative 5% error is an absolute error of 5%).
