History shows Wall Street's strategists to be an optimistic lot. This year was no exception: on average, prognosticators expected the S&P 500 to reach 1,370 by the end of 2011, according to a Bloomberg survey conducted last December. That represented a gain of 9%. But Binky Chadha of Deutsche Bank believed even those estimates were tame. He proclaimed that the S&P 500 would skyrocket to 1,550, a gain of 23%. Unfortunately, a few things got in the way of the S&P's rise, including the euro crisis and the U.S. debt ceiling fight. Today the index sits at 1,250.
Recent misfortunes haven't discouraged Chadha, according to his 2012 outlook. "We see very healthy corporate fundamentals, extremely cheap valuations and a strong demand-supply balance eventually winning out against the concerns about the risks," he wrote. Chadha's prediction for the S&P 500 at year-end 2012: 1,500, up about 20%.
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