Morgan Stanley CIO Cites 'Humbling Business' Behind Wrong Forecasts, Gives Up Predicting S&P 500 As One Division Faces SEC Probe

Similar to how Morgan Stanley's MS stock lately has underperformed many of its banking peers, its Chief Investment Officer Mike Wilson has significantly underperformed other market prognosticators. 

Wilson has gotten so many market forecasts wrong over the past few years that he's effectively given up even trying to predict their future movements.

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After successfully calling for the 2022 market selloff during market euphoria in September 2021, Wilson announced he would no longer make index-level calls, attributing his mistakes as being in "a humbling business" and that he now spends more time looking at specific companies.

Popular financial X user Barchart mocked Wilson's failed market forecasts, recently posting "after being wrong about everything over the last 18 months, Wilson has decided to no longer make bold predictions about the S&P 500."

While he retains his CIO position, Morgan Stanley said in an internal memo in February that Wilson would be leaving the firm's Global Investment Committee.Chief Operating Officer Jed Finn said Wilson would "focus on serving his key institutional clients, where the demand for generating tactical alpha is intensifying."

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Morgan Stanley's Wealth Management division has recently brought negative attention to the firm. It is the target of a multiagency probe that includes the Securities and Exchange Commission, the Office of the Comptroller of the Currency and other Treasury Department offices. 

The investigation stems from concerns that Morgan Stantley's know your client (KYC) procedures may be inadequate. Wilson was hired as CIO of Morgan Stanley's Wealth Management division in 2012.

While some investors and traders can be keen to follow Wall Street's short-term predictions, it may be worth remembering the famous quote by Fisher Investments Chairman Kenneth Fisher, who said, "Time in the market beats timing the market."

The SPDR S&P 500 ETF Trust SPY, the ETF that tracks the S&P 500 index, is up about 72% over the past five years and over 1,000% since 1993.

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