The Paradox of Wall Street's Accuracy: Morning Brief

Recent market reversals in the equity and fixed-income markets have highlighted the challenges of making accurate forecasts in the investment business. However, these reversals also serve as a reminder of the timeless investor psychology lesson to be fearful when others are greedy and greedy when others are fearful. Investment strategists provide prompts for professional investors to consider whether their portfolios are properly calibrated, rather than offering exhortations for action. While some investors may act on analyst opinions, the highly regulated world of investment management emphasizes caveat emptor. The critique of Wall Street's daily firehose of opinions and warnings suggests that fewer people are needed in stock picking, as many of these opinions are more prescriptive in theory than in practice.