These 2 Forecasters Nailed S&P 500 Last Year Pretty Accurately

Forecasting is a highly inaccurate science despite the tall claims made by many forecasters. Financial forecasting can be compared to having a crystal ball that tells you what is going to happen in the future to the markets. If you can make accurate forecast you can make a lot of money. Most forecasting is done using mathematical algorithms. Predicting S&P 500 index is considered to be a tough job. There are not many forecasters who would put their reputation on the line predicting S&P 500. Why? Because markets sometimes ignore fundamentals and take a random walk. Or, because forecasters are simply not good at predicting how investors will behave in any given year. Or, because of a combination of constantly moving factors.  Could anyone predict crude oil price crashing from $107 per barrel to $53 per barrel in 2014. No one could have predicted Saudi Arabia glutting the market with excess supply just to break the back of the new shale oil companies. If you have been an expert of game theory even then it would  have been a pretty difficult thing to predict what would happen to the oil market and the Russian Ruble. S&P 500 index is considered to be a barometer of US economy. There are many traders who love to trade the S&P eminis. Knowing S&P 500 index levels in advance can make you a lot of money trading S&P eminis.

When it comes to setting a target for the S&P 500 SPX, +0.33% , it looks like the top prize will be shared by Jonathan Golub of RBC Capital Markets and J.P. Morgan’s Thomas Lee. Both analysts had a target of 2,075 (the index ended Tuesday at a record 2,082.17), which marked the top end of the 2014 forecast range. The S&P 500 ended 2013 at 1,848.36.

You should take a deep look at the 2 different methods used by these 2 people to predict the S&P 500 target. The 2 analysts arrived at almost the same number using 2 different methods.