The 2018 Boglehead Contest

The 2018 Boglehead Contest was announced in a December 31, 2017  Bogleheads Forum topic post .

The Boglehead Contest is an annual event that takes place on the Bogleheads forum where members take guesses to forecast the closing price of the S&P 500 Price Index at year end. Keep in mind that the Price Index is simply a measure of market price and does not take into account stock dividends or the reinvestment of dividends. Thus, the Price Index does not represent the total return for an investment in an S&P 500 index fund.

The contest also includes forecast predictions from “expert” Wall Street firms, and the comparison between the amateur and expert camps is considered a fun distraction looking at the potential follies of making predictions.

The rules of the contest are simple:

  1. Guess the closing price of the S&P 500 Price Index on December 31 of the year in question.
  2. Only one guess (no percentages) is allowed.
  3. Registration closes on midnight January 10 of the given year.
  4. In event of ties, the first guess wins.

This year  introduced a new automatic registration for the annual contest. Instead of entering guesses in the forum topic, participants  entered guesses using a contest entry form.

Contest statistics

At the conclusion of the entry period, the contest included 493 prognostications. On average, the Bogleheads predict an implied 5.94%  2018 return for the S&P 500 index; the Wall Street experts predict an implied 6.26% return.

Boglehead Contest Summary Statistics

Summary Bogleheads Wall Street Experts
Number of entries 479 14
Average guess 2832.49 2840.92

The frequency distribution of the final entries can be seen in this histogram chart.

2018 histogram

Chart courtesy of SimpleGift

This year’s predictions continue the tendency of participants, both amateur Bogleheads and Wall Street “experts”, to make, on average, bullish market predictions. The two charts below provide historical data on bull and bear predictions (click image to enlarge).

About

Barry Barnitz, administrator of both the Bogleheads® wiki and of Financial Page, a Bogleheads® blog. In addition I serve as an administrator of finiki, the Canadian financial wiki, and as an administrator of the John C. Bogle Center for Financial Literacy site.

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