The 2020 Boglehead Contest

The 2020 Boglehead Contest was announced in a January 1, 2020  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.[1]

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.

Contest statistics

At the conclusion of the entry period, the contest included 665 prognostications. On average, the Bogleheads predict an implied 4.29% return for the S&P 500 index in 2020; the Wall Street experts predict an implied 2.14% return, marking a 2.15% difference between the two groups’ predictions  As a point of reference, the S&P price index closed at 3230.78 at 2019 year end.

Bogleheads Contest Summary Statistics

SummaryBogleheadsWall Street Experts
Number of entries65312
Average guess3369.143300.00

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

2019 close 3230.78

Continuing an unbroken historical trend, a majority of participants in the contest remain optimistic, prognosticating a rising 2020 market.

Notes

[1] 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.

Tagged with: