Wall Street price targets and why you should always ignore them

At the beginning of the year, the consensus on Wall Street was for a 12.3% gain in the S&P 500 in 2025. These price targets were accompanied by in-depth research and lots of graphs as to make it look like a sophisticated analysis. We are now down more than 20% from the all-time highs and although we might end up the year positive, a 20% drawdown is still huge.

The reality is that the analysts always expect the market to gain more or less its usual average which is 10% over the long run (give or take). Moreover, there's lots of stigma among analysts to take contrarian bets because it's always better to be wrong when everyone else is wrong rather than being the only one who got it wrong with the risk of losing reputation and your job.

In the markets, conditions change and when conditions change you should adapt and revaluate your views. That's why all those price targets and outlooks at the beginning of the year are useless. Remember, that everyone can be wrong. There's no one getting it always right, not even the most successful traders and investors in the world.

There's a great interview from Real Vision with the famous investor Jim Rogers who founded Quantum Fund with George Soros. The video begins with Jim Rogers delivering the most important lesson for anyone just starting out in trading:

"When I first got in the business, I used to assume that everybody knew a lot more than I did. They were educated, better experienced and everything, so I just assumed that if they say X, X was probably the case. It took me a little while, but not too long, to figure out that they didn't know any more than I did."