Guru Grades
Linda Schurman: The Astrologer Versus the "Stock Star" (Last Updated 6/13/09)
A reader wondered: "Is astrology more or less accurate than Jim Cramer?" She suggested that we check by reviewing the monthly stock market predictions of SootheSayer Linda Schurman, available back to August 2004. As an astrologer, Linda Schurman states that her "profession is all about cycles..." The table below extracts highlights from her stock market forecasts and shows the performance of the S&P 500 index over the 21, 63, 126 and 254 trading days after the publication date for each item. Red plus (minus) signs to the right of specific items indicate those that the market has subsequently proven right (wrong). We conclude that:
- Over the period of available forecasts, Linda Schurman has been generally very pessimistic on prospects for the U.S. economy.
- We do not understand astrological forecasting processes, so we cannot characterize how she makes stock market predictions.
- Based on subsequent stock market performance and our judgments about the accuracy of Ms. Schurman's forecasts, her bottom-line advice about market direction has been right 43% of the time, a below average accuracy rate. The forecast sample size for Ms. Schurman is modest, as is our confidence in this conclusion.
- In her July 2006 entry, Ms Schurman swore off stock market predictions because of her poor financial market forecasting record. As of October 2006, she resumed occasional financial market predictions but has made none since June 2008. We are therefore changing her status to "dormant" pending any new stock market forecasts.
In summary, with a current accuracy rating of 46%, Jim Cramer beats SootheSayer Linda Schurman by a little. Confidence in this conclusion is modest.
See Guru Grades for a snapshot of the accuracy of various experts in predicting the direction of the U.S. stock market, including links to evaluations of the commentaries of other individual market pundits and gurus.
