One of the more futile functions of brokerages is to issue targets on indices, and to a lesser extent on stocks. Often these are horribly wrong and almost always, brokerages tend to issue a higher target when the market is going up, and revise it downwards when the market is going down.
These days since the markets are going up, all brokerages are scampering to issue higher Sensex and Nifty targets, and it’s funny to see a whole bunch of them issuing a target that is close to what the others are issuing, and you feel that surely these people are hedging their bets, and don’t mind being wrong in a herd rather than be correct alone.
There’s rarely any accountability on what happened versus what they said and I feel that anyone who uses these targets to buy or sell is doing a great dis-service to themselves.
I’m going to start a post here that collates Sensex targets from various brokers, and at a certain point in future compares them to what the market is actually doing, and see how various brokerages do.
|Brokerage||Target||Target Date||Issue Date|
|Edelweiss||29,000 (Sensex)||Dec 31 2014||May-14|
|Macquarie||28,000 (Sensex)||Mar 31 2015||May-14|
|Deutsche Bank||28,000 (Sensex)||Dec 31 2014||May-14|
|BNP Paribas SA||28,000 (Sensex)||Dec 31 2014||May-14|
|Nirmal Bang||28,000 (Sensex)||Dec 31 2014||May-14|
|Nomura||27,200 (Sensex)||Dec 31 2014||May-14|
|Bank of America Merrill Lynch||27,000 (Sensex)||Dec 31 2014||May-14|
|Citigroup||26,300 (Sensex)||Dec 31 2014||May-14|
|Goldman Sachs||8,300 (Nifty)||Dec 31 2014||May-14|
|Sharekhan||8,000 (Nifty)||Dec 31 2014||May-14|
|UBS||8,000 (Nifty)||Dec 31 2014||May-14|
The idea is that observing this for an year or two will either show that these targets are close to being right, and have some use or are completely bogus, and that data will be useful for people who are swayed by these things to make decisions to either buy or sell stocks, and will hopefully help them become better investors.