We evaluate here the the market commentary of Paul Tracy available via Zacks.com since October 2002. Paul Tracy, founder and Chief Investment Strategist of StreetAuthority, is one of Zacks’ “pros.” StreetAuthority describes itself as “a research-intensive financial publishing firm that aims to level the playing field for small investors by giving them access to the ideas and insights of some of the country’s top investment analysts and writers.” The table below quotes forecast highlights from the cited source and shows the performance of the S&P 500 Index over various numbers of trading days after the publication date for each item. Grading takes into account more detailed market behavior when appropriate. Red plus (minus) signs to the right of specific forecasts indicate those graded right (wrong) based on subsequent market behavior, while red zeros denote any complex forecasts graded both right and wrong. We conclude that:
- Paul Tracy is a long-term investor, generally advocating being in stocks even when short-term prospects for the overall market are unfavorable. He seeks to overcome poor markets by choosing the right sectors and stocks.
- With respect to market timing, Mr. Tracy was a little late to see the strength of the 2003 advance, when being early was better because the first stage of the advance was so strong. He was also slow in taking his foot off the pedal in early 2004.
- Paul Tracy’s forecast sample is moderate, as is therefore confidence in the measurement of his accuracy.
- Mr. Tracy has stopped issuing public forecasts via Zacks.com.
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.
| S&P 500 Index | ||||||
| Date | Comments from: Paul Tracy via zacks.com | 5-Day Return | 21-Day Return | 63-Day Return | 254-Day Return | |
| 11/10/05 | With inflation once again on the front pages, gold stocks should offer a solid hedge for investors at least over the next few quarters. | 1.0% | 2.4% | 2.9% | 13.2% | + |
| 10/14/05 | …the major averages may remain sluggish as a result of mixed economic and earnings news… In a flat or choppy market, careful stock selection is paramount. | -0.6% | 4.0% | 8.5% | 15.1% | – |
| 9/14/05 | …high energy prices, the aftermath of the hurricane and other fundamental concerns will put major pressure on the market as we head into 2006. | -1.4% | -4.1% | 2.7% | 7.7% | + |
| 8/15/05 | … the broader averages are likely to march in place for the next few months. | -1.0% | -0.5% | -0.2% | 5.2% | + |
| 6/8/05 | …play defense…run for stable companies with solid earnings profiles. | 1.0% | 1.4% | 3.2% | 3.5% | – |
| 3/9/05 | …slower growth could potentially cap any further rallies in the broader market averages. | -1.6% | -2.1% | -0.8% | 6.4% | + |
| 2/22/05 | …if bond yields start to move strongly higher later this year, then that could put pressure on the equity markets. | 2.2% | -1.0% | 0.4% | 8.9% | – |
| 1/11/05 | …the overall market is likely to remain fairly flat throughout 2005. | 0.1% | 1.2% | 0.4% | 8.8% | + |
| 11/30/04 | …may well be enough to keep the market buoyant into the first part of 2005. | 0.3% | 3.4% | 3.1% | 7.7% | + |
| 11/10/04 | Positive economic data coupled with seasonal strength…may be enough to push a year-end rally in stocks. However, that rally is unlikely to benefit all stocks equally. | 1.6% | 2.2% | 2.5% | 6.2% | + |
| 8/25/04 | …weak economic data, high oil prices and increased terror concerns going into the election season…will likely put a cap on any rally this autumn…[use] caution with your portfolio in the months ahead. | 0.1% | 0.5% | 6.5% | 9.1% | – |
| 8/11/04 | …the overall market could continue to trend lower here in the coming month or two… | 1.8% | 4.5% | 8.3% | 14.4% | – |
| 7/27/04 | …the market is likely to remain extremely volatile in the coming weeks [suggesting] a cautious stance. | 0.4% | 0.9% | 0.1% | 13.6% | – |
| 7/13/04 | …stay cautious in the current market environment…the overall market might trade flat-to-down in the coming months. | -0.6% | -3.5% | 0.6% | 10.0% | + |
| 6/23/04 | [Take] a cautious approach toward your investments in the coming weeks and months. However, “caution” doesn’t necessarily mean you need to sell all of your investments. | -0.3% | -5.1% | -1.3% | 4.2% | + |
| 6/10/04 | …bullish points…aren’t likely to prove sustainable in the coming months. | -0.1% | -1.9% | -1.6% | 5.9% | + |
| 5/25/04 | …the broader market is headed south (or is at least likely to tread water)…in the coming months…one sector you should really consider making a core part of your portfolio is oil stocks. | 1.1% | 1.9% | -1.5% | 7.7% | + |
| 5/12/04 | The market has moved sharply lower in recent weeks, and is therefore due for an oversold bounce…the major indices could post a nice rally here in the coming days or weeks. However…any future market rallies aren’t likely to last very long…get a bit more defensive with your portfolio… | -0.8% | 2.6% | -2.0% | 6.2% | + |
| 4/29/04 | …the market is at a very uncertain juncture right now be…more cautious than at any point in time over the past 18 months. | 0.0% | 0.6% | -1.2% | 4.2% | + |
| 4/13/04 | …the markets are likely to remain locked in a tight trading range in the coming weeks. | -1.0% | -2.8% | -1.3% | 1.2% | – |
| 3/31/04 | Although…the market is likely to charge to new highs later on this summer…[don’t] be surprised to see the market stay in a fairly tight trading range in the coming month or two. | 1.3% | -1.7% | 1.3% | 4.9% | + |
| 3/16/04 | Although…the market still has room to move higher…it certainly doesn’t hurt to diversify your portfolio into some more defensive issues. | -1.5% | 1.6% | 1.9% | 7.1% | – |
| 3/3/04 | …the markets have enough life left in them to post another strong rally here in the coming months. Beyond that, he could see a 10-15% correction in the latter half of the year. | -2.4% | -1.6% | -2.6% | 6.5% | – |
| 2/18/04 | …the markets have enough life left in them to post another strong rally here in the early part of the year. Beyond that, we could see a 10-15% correction in the latter half of the year. | -0.7% | -2.6% | -5.9% | 4.3% | – |
| 2/3/04 | Although we might see a few more days of profit-taking here in the near-term…the market will extend its recent gains throughout the first half of the year. Beyond that, rate hikes, a possible economic slowdown and overheated equity market valuations could…send…the major indices lower in the second half of the year. On the whole though…2004 will be a positive year for the markets. | 0.8% | 1.7% | -1.6% | 5.9% | – |
| 1/20/04 | …this quarterly season…the markets might very well continue their hot streak. However, beyond that…the current rally is going to run out of steam, and we’re bound to see a correction of perhaps 5-10%…any such correction is likely to be short-lived…expect the markets to gain 15-20% in the first half of the year. | 0.5% | 0.7% | -0.3% | 2.6% | – |
| 12/9/03 | …a sweeping rebound across many areas of the technology industry now looks to be at hand. | 1.4% | 5.8% | 6.0% | 13.1% | + |
| 11/25/03 | …expect to see [no] major market sell-off in the near future. | 1.0% | 4.0% | 8.6% | 11.4% | + |
| 11/11/03 | The market may be in line for a near-term correction, but…U.S. equities will still trend higher closing out 2003 and entering 2004. | -1.2% | 2.4% | 10.6% | 13.1% | + |
| 10/21/03 | …the third-quarter earnings season is shaping up to be a spectacular one…the markets are going to trend higher in the near term. | 0.1% | -0.3% | 9.7% | 4.7% | – |
| 10/7/03 | …equity markets could be prone to short term bouts of profit taking in the coming weeks…investors should take advantage of any near-term market weakness to scoop up select long-term winners. | 1.0% | 1.2% | 8.1% | 8.2% | – |
| 9/23/03 | …all signs are still pointing toward solid gains in the equity market in the months ahead…view any sort of short-term pullback as a major buying opportunity. | -3.2% | 0.1% | 5.8% | 7.2% | + |
| 9/9/03 | {Don’t] be surprised to see stocks continue to battle back from the multi-year lows we saw in March as the economy bounces back and corporate profits begin to roll in. | 0.6% | 1.0% | 3.7% | 10.0% | + |
| 8/19/03 | …even though the market probably SHOULD (in theory) take a breather here over the short-term, it’s quite possible that investors will pour back into equities in the coming weeks for fear of missing out on the next big rally. | -0.6% | 3.7% | 4.8% | 9.3% | + |
| 7/15/03 | …the market is likely to feed off of positive earnings news and to climb higher in the short term…favor the bullish case here. | -1.2% | -1.6% | 3.8% | 10.0% | – |
| 6/17/03 | …we are now in a bull market…the market has gotten a bit overextended in the short term…the markets have yet to see their highs for 2003…[a] pullback [is] an excellent buying opportunity. | -2.8% | -3.0% | 0.3% | 11.7% | + |
| 6/2/03 | …for the first time in years investors are now willing to overlook gloomy economic data in favor of chasing stocks higher. The major indices could stumble sometime in the next few weeks…followed by a one- or possibly two-month correction. Beyond that…fear [of missing out] will continue to send the market higher into the end of 2003. | 0.9% | 1.6% | 3.7% | 15.5% | – |
| 5/13/03 | …maintain [a] bullish stance on the markets going forward, but given how far the major indices have come over the past few months, we’re likely to take a breather at some point in the coming weeks. | -2.4% | 6.0% | 4.1% | 16.3% | – |
| 4/29/03 | …the longer-term condition of the market…looks more positive than it has in years…get a bit more aggressive with…portfolio holdings. | 1.8% | 3.5% | 8.6% | 20.6% | + |
| 4/8/03 | …markets are likely to remain stuck in a fairly tight trading range over the near term…it is time to start getting a bit more aggressive with your investments. | 1.4% | 4.8% | 14.8% | 30.4% | – |
| 3/25/03 | Too many risks still remain…risk-averse investors would be wise to treat the recent advance as merely just another in a long series of brief bear-market rallies…the markets will move higher by the time the year is out…investors might be wise to start moving back into more aggressive mutual funds in the coming weeks/months. | -1.9% | 4.2% | 12.2% | 26.7% | + |
| 3/11/03 | …the U.S. economy is in rough shape at the moment, meaning you should still use extreme caution when making any major investing decisions…many high-quality companies are now trading well below their intrinsic values. | 8.2% | 8.2% | 21.9% | 39.9% | – |
| 2/24/03 | …the outset of war with Iraq will [not] put an end to these uncertain times…the downside risks associated with holding gold stocks are too great at current price levels. | 0.3% | 5.1% | 11.9% | 37.5% | – |
| 2/10/03 | We may see a sharp rally at the outset of any war, and the markets could soar if the U.S. wins a swift and decisive victory, but ultimately, uncertainty will probably continue to hang over the market in the coming months. | 1.8% | -3.8% | 11.7% | 37.8% | – |
| 1/27/03 | …expect…the market’s skid to continue in the coming weeks. | 1.5% | -2.4% | 6.1% | 33.8% | + |
| 1/13/03 | …the markets will rally nicely in 2003, [but] a number of major uncertainties remain…position portfolios to…weather the possible storm. | -4.2% | -11.6% | -6.3% | 22.2% | + |
| 12/26/02 | Although history could be pointing us toward an end-of-year rally…any major news could push us sharply in either direction thanks to low market volume. | 2.1% | -3.5% | -2.4% | 24.7% | + |
| 12/11/02 | …the markets might have enough energy left to hold strong as we close out the year. However, substantial risks remain. | -1.5% | 2.4% | -8.1% | 18.0% | – |
| 11/19/02 | …be cautious with your portfolio in the coming weeks. The markets will probably remain choppy on very light volume until after the Thanksgiving holiday. | 1.8% | -1.4% | -6.7% | 15.4% | + |
| 11/5/02 | …the markets will remain choppy in the coming weeks… [Don’t] be surprised to see a continuation of the recent rally in the short term…followed by a swift reversal as poor economic news continues to roll in over the course of the next month…the real money is going to be made through shorter-term swing trading in the months ahead. | -3.5% | -1.0% | -7.8% | 15.1% | – |
| 10/16/02 | …last week’s rally is [not] sustainable. Keep defensive with your own portfolio. | 4.2% | 5.1% | 6.8% | 21.5% | – |
| 10/2/02 | …expect…the market’s recent slide to continue in the week ahead. However…[do]n’t be surprised to see a bit of a snap-back rally the following week. Don’t let any short-term market upswings fool you though…any such short-term market rallies aren’t going to be sustainable… The markets might come under continued pressure in the weeks ahead, but the good news is that valuations are now approaching much more attractive levels | -6.2% | 7.0% | 6.3% | 24.9% | + |
