CFA CONSENSUS: (Negative Consensus/Bull Market Indicator) More tepid growth in 2015

December 19, 2014

If there is a one group of people that should have all this finance and stock market stuff figured out it are those who possess the Chartered Financial Analyst designation. The CFA is the crème de la crème designation in finance. Recipients who complete the program have passed 3 of the most difficult exams on the planet (Knowing this first hand after preparing and writing the level 1). If there is anyone that could have a solid grasp of the fundamentals of our economy and the stock market as a whole, it would be these folks.

Just recently the CFA Institute surveyed 5,259 charter holders about their expectations for the Canadian and global economy in 2015. Here are their takes:

  • The Canadian economy will expand by 1.7 percent in 2015. World GDP will grow by 2 percent.
  • S&P/TSX  Composite index will rise 1.5 percent and the S&P 500 by 4.8 percent.
  • 30 percent of respondents said that central bank stimulus (i.e. money printing) will provide the biggest potential positive impact on stocks.
  • Largest risk to performance would be weak growth in advanced economies.
  • China and the US are the best investment opportunities for stocks.

These seem like reasonable, middle of the road expectations. Not to hot and not to cold. Just meh and right now it appears meh is enough to keep Central Banks around the world from rushing to increase interest rates. As long as this dynamic is in play, stocks could continue their 5+ year ascent to higher highs.