As long time readers must know by now, we occasionally like to foray into the realm of soothsayers and crystal ball gazers and make wild predictions for the closing price of the world-famous S&P 500! (We also consider ourselves the sacred keepers of the S&P 500 Dividend Return Calculator - a little S&P obsessed?)
How Do You Do It?
Not to bore said readers, but we use options pricing retrieved right before we write these pieces (these particular prices were retrieved on 7/17/13). Options have a nice little advantage which allows us to come up with these predictions - they close on a certain date, and they have a specific price where they make money. That means we can go beyond the direction implied by stock buys and sells - and add time-frame and magnitude to our predictions!
Care? Check through our archives for a few more explanations. One thing to note - we use the ETF 'SPY', and multiply by 10.
Don't? Here are some pretty graphs! As we've said in previous articles, these predictions have historically been pretty bad - so perhaps they are more useful for you to find mispriced options. Let us know how you use them!
First up, closing prices based on puts. Remember, these are as of the options expiration data for the listed month. Find it here.
And, here come the calls:
Those Graphs Are Useless.
Maybe so. Here are the raw numbers, adjust your models accordingly!
| 2013-08 | 2013-09 | 2013-10 | 2013-12 | 2014-01 | 2014-03 | 2014-06 | 2014-12 | 2015-01 | 2015-12 | |
| Put High | 1693.06 | 1680 | 1697.69 | 1670.85 | 1591.2 | 1680 | 1700 | 1875 | 1750 | 2391.67 |
| Put Medium | 1671.81 | 1640 | 1650 | 1590 | 1545 | 1582.88 | 1610 | 1500 | 1555 | 1658.49 |
| Put Low | 1610 | 1500 | 1555 | 1410 | 1452.17 | 1380 | 1460 | 1205.84 | 1350 | 1299.31 |
| 2013-08 | 2013-09 | 2013-10 | 2013-12 | 2014-01 | 2014-03 | 2014-06 | 2014-12 | 2015-01 | 2015-12 | |
| Call High | 1700 | 1730 | 1721.7 | 1730 | 1750.76 | 1820 | 1780 | 1756.87 | 2240.42 | 1800 |
| Call Medium | 1680 | 1680 | 1671.4 | 1680 | 1728.03 | 1702.12 | 1710 | 1650 | 2025 | 1654.51 |
| Call Low | 1650 | 1640 | 1561.4 | 1670 | 1700 | 1660.32 | 1630 | 1600.63 | 1775 | 1600 |
So there you have it! Another entry in our infamous series - and one of the few recurring features on the web where an author tosses hard numbers up there. I regret nothing.
Where do you think the S&P 500 is headed this year? 2014? 2015? Are the options too pessimistic? Optimistic? Discuss!
