The Myth of the “Genius Market Predictor”

Why being right on one market call doesn’t mean anyone can see the future

Every few years, someone makes a bold call, gets it right, and suddenly becomes the new market “prophet.”

One perfectly timed prediction instantly elevates an investor into “financial superhero” territory. And once that happens, people start to believe that person has a special ability — that they can see things ordinary investors can’t.

But what happens next is remarkably consistent:

They’re right… until they’re wrong. Often really wrong.

It’s one of the clearest reminders of how unpredictable markets really are.

Enter Michael Burry:

You probably know Michael Burry from The Big Short, played by Christian Bale. He predicted the 2008 housing collapse when almost nobody else believed him. It earned him fame and an enormous amount of money. But what about after 2008? Since then, Burry has:

• Predicted several stock market crashes that never materialized
• Shorted the U.S. market in 2021 — right before one of the strongest rallies in history
• Claimed in 2023 that we were in “the biggest bubble of all time,” only for markets to continue rising

Burry is brilliant, no question. But even he can’t reliably predict the future. He’s just one example of a long list of investors who nailed one huge call, then struggled afterward.And he may very well end up being right eventually… but timing matters.

John Maynard Keynes said it best:

“Markets can stay irrational longer than you can remain solvent.”

In other words: Even when your idea is right, betting on the timing can sink you. Famous investor Peter Lynch had his own thoughts predicting the movements of the stock market:

“Far more money has been lost by investors preparing for corrections or trying to anticipate corrections than has been lost in the corrections themselves.”

This is exactly what the data shows. Why trying to time the market hurts investors Trying to jump in and out of markets, even with the best of intentions, almost always backfires. Hartford Funds looked at the growth of $10,000 invested inthe S&P 500 from 1995 to 2024. Here’s what they found:

• Fully invested: $10,000 grew to $224,278
• Miss the 10 best days: $10,000 becomes $102,750
• Miss the 20 best days: $10,000 becomes $60,306

And here’s the kicker. About half of the best days occur during bear markets, exactly when investors are most likely to sell.

So if the experts can’t predict the markets, what does that mean for investors?

It means something most people don’t want to hear. Even the smartest investors in the world, with unlimited data, resources, and research, rarely get predictions right consistently. And no one has made this point more clearly than Warren Buffett.

Warren Buffett on predictions

Buffett, arguably the most successful investor alive, has been exceptionally straightforward about forecasting:

“I have no idea what the stock market is going to do tomorrow or next year.”

“We make no effort to predict where the market will be in twelve months.”

This is coming from the man with the best long-term track record in modern history. If anyone has earned the right to say “I can predict markets,” it’s Buffett.But he refuses to do it. Because he knows it doesn’t work.

His approach is simple:‍

• Buy strong, durable businesses
• Ignore economic forecasts
• Stay invested
• Let compounding work its magic

Buffett didn’t become wealthy by guessing. He got wealthy by buying good assets while everyone else was distracted by predictions.

Why we don’t build portfolios based on predictions

At Endeavour Wealth Management, we share the same philosophy. We don’t try to guess the next recession or the next crash. We don’t make big bets on which sector or country will lead. We don’t claim to know where markets will be next quarter.

Instead, we focus on what actually works

• Broad global diversification
• Evidence-based investing
• Matching risk to your goals and your lifestyle
• Staying disciplined through noise
• Keeping costs low
• Letting time and markets do the heavy lifting

This approach doesn’t require predictions which is exactly why it works. Making market predictions is not a skill that has to lead the best investors to long-term success.But building a portfolio of good assets and behaving well is. These are the things that build long-term wealth. Not market predictions.

If you want a portfolio built on evidence not predictions let’s talk.‍

Book your introductory meeting today and take the first step toward a stronger long-term plan.

This information has been prepared by Brandt Butt who is an Investment Advisor and Portfolio Manager for iA Private Wealth Inc. and does not necessarily reflect the opinion of iA Private Wealth. The information contained in this newsletter comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors. The Investment Advisor and Portfolio Manager can open accounts only in the provinces in which they are registered.

iA Private Wealth Inc. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. iA Private Wealth is a trademark and a business name under which iA Private Wealth Inc. operates.