The trouble with forecasts: Should investors bother making predictions for 2017?

Challenging year ahead

Editor Katrina Lloyd tackles the issue of just how important New Year's predictions should be for investors after the twists and turns of 2016.

Not a lot, according to recent research from Intertrader, which found investment banks' recommendations are only marginally better than a coin flip. It discovered banks only managed to predict the correct direction their 'hot picks' would go 55% of the time - and recorded a gain over the course of an entire year of just 0.8% However, despite this low success rate, investors are undoubtedly fascinated by market predictions, and the more extreme the better. Remember the RBS credit team advising clients at the start of last year to "sell everything" except high quality bonds as it warned...