Header Ad

On the quality of financial forecasting on one chart

An interesting graph caught my eye (Source: JPMorgan, Bloomberg). The thick white line is the Fed rate. Thin white lines and an orange line are market participants’ rate expectations based on forward contracts.

The interest here is that, even when making predictions about predictable events (in this case, forecasts of the key rate dynamics), people are more likely to make mistakes than they are right or even roughly right. But the Fed does not play against the market and its participants, which simplifies any assumptions about its behavior. If we are talking about a stock exchange game, where these same participants are already playing against each other at the rates of securities, currencies and commodities, the percentage of luck, presumably, is quite modest.

TELEGRAM t.me/probonds
YOUTUBE https://www.youtube.com/c/PRObonds


An interactive magazine for Forex traders. Here you will find the latest relevant news, examples of successful transactions and unsuccessful investments. Our journal contains a daily report of the trade of our specialists on the Forex exchange.

Forgot Password