Around about now Wall Street and others begin to trot out what their predictions for the coming year are. The latest round of such crystal ball gazing can be found here in an article by Bloomberg called Here’s (Almost) Everything Wall Street Expects in 2019 You can peruse this sort of nonsense at your leisure.However, before you waste your time consider this – Barron produced an article looking at how the picks by the best and brightest did via their 2019 round table. This article may disappear behind a paywall but can be found here for the time being. I have taken the liberty of reordering the data from their report into the table below. I have sorted their returns as per the article but have added in an average return for an equally weighted portfolio containing the recommended stocks.
Last year the S&P500 TR Index returned -5.9%, as you can see six of our eight experts under performed the index and only two managed a positive return. A little bit of context is needed here. Each individual could trade their picks how they saw fit – they could close positions out or change them. It should also be noted that they all are or have been professional money managers. We are talking about people who are probably paid close to and into the seven figure mark for their supposed expertise. All that money and not one of them managed a double digit return. In the chart below you can get a better sense of how badly they did.
And if you are still wondering they all still have jobs – welcome to finance the only profession in the world were you can be worse than average and still be paid a fortune.