pfp Advisory: "And every year the DAX forecasts return"

Roger Peeters explains why DAX forecasts sound like déjà vu every year—and why investors are better off focusing on strategy rather than crystal balls.

5 January 2026. FRANKFURT (pfp Adisory). Around the turn of the year, I feel a bit like Phil Connors, the somewhat cynical weather presenter from the film “Groundhog Day,” who experiences the same day over and over again. After all, the recurring patterns (in this case annually) are very pronounced at this time of year. With the arrival of the new year, the whole world seems to be filled with new resolutions for diets, more exercise, and healthier living in general.

Shortly before that, and with the same consistency, there is virtually no escape for investors, at least those who are inclined to do so, from encountering the big forecast tables for the dollar, interest rates, EURO STOXX, and, of course, the DAX. I have been working in this industry for several decades now and consider myself to know many people who are professionally involved in the capital market. I wouldn't rule out the possibility that there are people among the real professionals who say, “Oh, it's a good thing to enter the market now, after all, 25 experts surveyed see the DAX about 2,000 points higher in a year.” However, I haven't encountered any of them. Seriously, I don't really know what this “crystal ball challenge” is all about.

I have a certain idea of how these frequently encountered tables come about. I think it's conceivable that the editors-in-chief of national newspapers with large business and finance sections tell their staff, “We have to be there, xy is in it too, and our readers need guidance, especially in these turbulent times!” (which seem to be every year). The picture is similar in the banking sector, of course: “How can it be that 20 institutions are surveyed and we're not included?” So, by the turn of the year at the latest, virtually every bank with capital market business has some strategist who has an opinion on how the DAX will develop. 

The forecasts, and here we return to the “Phil Connors syndrome” mentioned at the beginning, are characterized by a fascinating predictability. Regardless of whether we are at the end of a bull or bear market. Regardless of whether we are in a boom or a recession. Regardless of whether interest rates are rising or falling, and regardless of what else is happening in the world: the forecast values are, with a probability bordering on certainty, on average about eight to ten percent above the index level at the time the forecast was made. This year, for example, the DAX ends up at around 26,000 points in such surveys. Compared to the DAX level at the time the survey was conducted, the gap I outlined is once again quite accurate. This average value is not achieved because one strategist expects 20,000 points and another 32,000, but because more or less all of them are remarkably close to the average historical annual performance. The small but significant difference is that this history is based on a much wider range. In reality, moderate increases are not the rule, but the exception.

It is understandable that hardly anyone dares to make bold predictions with changes of more than 20%. If the assumed direction is wrong and you go out on a limb, you could look like a loser in a year's time; you may have had the boldest prediction, but also the “wrongest” one. That's why people prefer to hide inconspicuously in the herd. For me, this redundancy goes hand in hand with questionable benefits. The other reason why I reject these “prediction games” is that they are simply questionable in their concept when it comes to capital markets. Capital markets are so-called “self-referential systems,” i.e., in short, systems that observe themselves and thereby change expectations. In addition, the complexity and number of influencing factors are simply too great. Compare it to the weather: many meteorologists are quite capable of predicting the weather a few days ahead with a high degree of accuracy. But even the best in their field will not be able to tell you whether it will be stormy or snowy 12 months from now. Too much can happen between now and then. And no one knows what will happen.

My proposed alternative to striving for greater security, where the xy index (everything written here applies equally to EURO STOXX, S&P500, etc.) is quoted in twelve months, is a fundamental, long-term strategy (such as savings plans in selected products) and a calm attitude regardless of whether the market rises or falls in the short term. Most investors want to participate in the markets over the long term and not bet on anything in the short term. And I don't really believe that it can be done systematically. That's why I don't pay much attention to it. Analogy to other special features mentioned at the beginning of the year. A sustainable, sensible diet makes more sense than a crash diet (with a built-in yo-yo effect) that you start in the short term just because it's January.