Market gurus are prominent in the financial community, and their forecasts often influence how people trade. Today we discuss a recent study by David Bailey, Jonathan Borwein, et al. that investigates the accuracy of these market predictions. With their new method for evaluating forecasts, the found that 48% of all the forecasts tested were correct and that 66.1% of the forecasters had accuracies below 50%.
Reference: Bailey, David H. and Borwein, Jonathan and Salehipour, Amir and López de Prado, Marcos, Do Financial Gurus Produce Reliable Forecasts? (February 28, 2018). Available at SSRN: https://ssrn.com/abstract=3339657 or http://dx.doi.org/10.2139/ssrn.3339657