Barron’s: “Wall Street’s Strategists Expect the S&P 500 to Gain 5% Next Year. They’re Almost Certainly Wrong.”By admin_45 in IN THE NEWS
Excerpt from Barron's quoting DataTrek's Nick Colas:
.... "Rather, it is because of how S&P 500 returns have been distributed historically. The index has risen an average of 11.4% in terms of total return over the past 90 years, according to NYU professor Aswath Damodaran as cited by DataTrek’s Nicholas Colas. With a dividend yield of 1.8%, that would imply a 2020 close of 3420 for the S&P 500 if it simply has an average year, Colas says. Only one of the strategists, Golub, was near that level, he observes.
But even Golub may be too conservative. The S&P 500 has gained 20% of more 36% of the time during the past 90 years, Colas notes. A gain of 5% or less just 13% of the time, about the same as a double-digit loss, which happens about 12% of the time"....
Read the full article here on Barron's!