HOW USEFUL ARE THE BARRON’S ROUNDTABLE PUNDITS?
Every year Barrons publishes their roundatable series where a group of market “experts” provide their opinions of the upcoming year. PunditTracker sent along this excellent analysis offering you a glimpse into the success (and failures) of the pundits and perhaps showing you which ones are worth listening to and which ones should be avoided. Not surprisingly, Felix Zulauf and Marc Faber are standouts over the last few years with their keen focus on the global macro:
“With the 2012 Barron’s Roundtable likely to be published in the next few weeks, we decided to comb the archives and compile the track records of the Roundtable pundits.
As was the case for the entire investment industry — roughly 70% of mutual funds underperformed their benchmarks — 2011 was a forgettable year for most of the Roundtable participants. Of the nine members we track (we exclude Bill Gross), only three outperformed the S&P 500.
2011 Returns Fred Hickey 9.2% Felix Zulauf 6.4% Mario Gabelli 5.6% S&P 500 -1.1% Abby Joseph Cohen -2.7% Meryl Witmer -3.9% Roundtable Average -5.0% Oscar Schafer -6.1% Marc Faber -12.3% Scott Black -13.6% Archie MacAllaster -27.8%
The group should still hold its collective head high, however, as its long-term track record remains splendid, as shown below. All but one of the 2011 participants has been there since 2002, including the late Archie MacAllaster. Fred Hickey joined in 2005.
Annualized Returns: 2002-11 Felix Zulauf 25.1% Marc Faber 23.4% Oscar Schafer 13.7% Roundtable Average 12.4% Meryl Witmer 11.3% Scott Black 4.8% Mario Gabelli 4.4% Abby Joseph Cohen 1.8% S&P 500 -0.2% Archie MacAllaster -1.9%
2005-11 (includes Hickey)
Felix Zulauf 23.5% Marc Faber 20.5% Meryl Witmer 11.5% Fred Hickey 11.2% Roundtable Average 9.2% Mario Gabelli 7.4% Oscar Schafer 6.5% Abby Joseph Cohen 4.3% S&P 500 0.1% Scott Black -2.6% Archie MacAllaster -11.8% For a year-by-year breakdown of returns, click here.
We should mention that these figures are somewhat crude, as they only reflect price appreciation and assume an equal allocation across the picks with a fixed one-year holding period. They do not include picks from the mid-year Roundtables.
Regardless, the returns are mighty impressive. To put the percentages in context, if you had spread $1000 across Felix Zulauf’s picks in 2002 and then rolled into his new recommendations each subsequent year, you would now have $9423. That is almost 10x the amount you would have if you did the same with the S&P 500 ($982)!
Returning to the mission of PunditTracker, while it would be tempting for us to cherry-pick the blowhard pundits to expose them, our goal is to illuminate both the good and bad pundits. While 2011 was a blip, the Barron’s Roundtable to date has clearly been the former.”
Source: Pundit Tracker
Excellent, I was looking for such a website since a long time – something that would rate the analysts and economists themselves! I am sure if they started rating you, Cullen, you’d come out on top
Zulauf from link 1 above:
“The industrialized world continues to live in a fiction: that it can afford its current lifestyle by going further and further into debt. At some point, the bond markets will riot against that.”
Not very MMTish..
Happy Swede, that’s why you need to keep your perspectives open.
MMT is a useful way of thinking of the world, but exclude everything else and your mind becomes caved in.
I’ve at times thought that Cullen has been a bit closed-minded about non-MMT perspectives. I even remember reading a post he did where he went beserk in caps.
That being said, the ‘austerity expansionists’ have been totally proven wrong in the last few years, but that doesn’t give a blanket check to the MMT crowd.
It means you have to think carefully about your assumptions, even if the other side is doing poorly.
Agree to an extent, but I suspect part of their quite stellar performance is due to making the right calls but for the wrong (if youre MMT like me) reasons, e.g. bullish on gold from inflationist perspective. But of course they are also savvy investors..
I do not think adhering to the descriptive part of MMT makes you close-minded in any way, quite the opposite it enables you to question a lot of the mainstream beliefs that people in this business use as a basis in their analysis. i.e. I don’t think you have to understand MMT to be a great investor, but I think that it certainly does not make your odds worse.
Fred Hickey’s number 1 recommendations in last January’s Roundtable was for gold and gold mining stocks. That worked very well Jan thru July, but since Aug there was a deep correction. I wonder if Hickey and Zulauf are sticking with gold as their top pick for 2012?
Based on their views plus Eihorn I made my move in gold early in the year but got out when the time was right with gold trading north of 1800 in the summer. I have not e en started considering a move back into the metal and/or miners.
Zulauf and Faber, who are the most successful over the long term, do not sound very MMT-ish at all. Faber is an Inflationista, warning about money-printing and the coming great loss in the value of the US Dollar. Both Zulauf and Faber argue in favor of gold and/or commodities, in order to offset a coming collapse in the US dollar. MMT-ers don’t see it that way at all. The next two to 3 yrs should be a good test to see whose theories have better predictive powers. I go with MMT, and I think US bonds and high quality div-paying stocks will do better than gold and commodities over the next 3 yrs. Inflation will be mild, not accelerating as they suggest.
It looks like companies are missing big time but patching it via rosy forecasts (Alcoa), and now Jamie at JPM.
http://www.marketwatch.com/story/jp-morgan-fourth-quarter-profit-revenue-drop-2012-01-13
And the read the headlines
http://www.marketwatch.com/story/newsviewer?link=MW_Nav_NV
JPM sees better loan quality, JPM sees improved loan demand, etc.
This is what PK and NT has to say on loan demand:
He agrees with Jamie, it is picking up:
http://www.northerntrust.com/media/kasriel_4Qseries2012_1/images/KasrielUs.pdf
BTW, the ECRI numbers are coming out tis morning. Last week WLI and its GR went down.
Looks like, feels like, sounds like, CR’s muddle through economy. Another year of easing, volatility and trading the S&P. Investors will find pickings slim, however through the process, some gems will get trashed. One example from last year… Intel. In this environment, and with a capital preservation strategy, I consider anything over 5% portfolio gain a winner. I pick 5% for one reason… I had to work my butt off to get it.
U R like me. If I get my 5% i am a happy camper:-) hell hard these days!
Futures don’t look so hot:
http://www.marketwatch.com/investing/future/SP2H?link=MW_story_quote
Your comparison is way off the mark.
Your S&P results do not include reinvested dividends. When those are included, the S&P beats all Barron’s stock pickers over 10 years. (I didn’t take the time to look at other years.)
Rich,
Please explain. Since the total return of the S&P 500 for the trailing 10 years is around an annualized 3.25% how could your statement be true?
I agree with Lance Rich…
You are correct that the analysis was flawded but that’s about it. Adjusted for dividends, SPY was $94.74 on 12/31/01 and end of ’11 was $125.50. That’s a cumulative return of 32.5% and a CAGR of 2.85%. Compared to the stated -0.2% annualized return, that implies a dividend yield over the 10 years of just over 3%, which makes sense. The correct actual S&P annualized return of 2.85% only bumps it ahead of one other person. It correctly puts Abby Joseph Cohen’s sorry 1.8% in her place.
Zulauf mentioned that gold only represents 0.6% of the world financial market today. How does he get this number? gold total worth is over 8 trillion now, do we have a 1300 trillion financial market? I don’t see how it’s possible unless you count the value of the underlying assets of all derivatives, but that doesn’t make sense. Derivatives are highly leveraged and cancel out each other. They introduce great volatility to the market, but they don’t represent money available to be invested.
Anyone knows?
Maybe Zulauf wants to compare gold to total credit & fiat money in the world? I doubt 8 trillion is the 0.6% of that but only USA credit+fiat+UST etc. is beyond 60 trillion USD.
Off topic but….
I am a real estate investor and at times use private lending to acquire it. I have investors that lend me money for 15 years, so I am constantly tracking rates and trying to figure out where they are going so I can get a fair rate and not have the private lenders money tied up at rates that will be too low for them in 5/10/15 years….I want them to be happy so I can keep getting loans.
After WWII the 10yr stayed under 4% for over 2 decades. Any predictions on the 10yr treasury over 5/10/15 years?
WLI UP 1 point to 121.2 but the GR went down to -8.4% (-0.2%)
Abby Joseph Cohen is still employed? Who would have thought…..
If I had to do a roundtable in this market…I’d be dead wrong. You all be throwing Tomatoes at via skype. Things change all the time…and I’d have to give these guys alot of credit for at least making calls.
Imagine having to lay out an entire year or 1/4 on print. And be held to it. The 1982-2000 bull has come and gone…so should these stupid Barrons roundtables. These guys should be posting daily and weekly.(most are) So with the exception of Cohen and any other swine that has not gotten fired from a Bank for doing there job correctly I give you Teddy Roosevelt. Some of these guys have been wrong…but…at least they have the balls to step in the arena to make a call.
It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.”
- Theodore Roosevelt
It looks like Zulauf and Faber rode the bull market in precious metals to achieve the stellar returns cited. It would probably be a mistake to expect them to come close to repeating this performance over the next 10 years.
These things have an uncanny way of evening out over time. It’s called reversion to the mean, or reversion to mediocrity.
So is there anyone out there worth following, besides Cullen?? What’s a poor bewildered investor to do? You tell me that I’m looking for a guru and there are no good ones to be found? They were just lucky followers of a now-dead bull market in gold? Say it isn’t so!