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Published: Saturday, 1/3/2004

Internet research key for Pick the Dow winner

Mark Parsons studied five years of fourth quarters before submitting his winning fourth-quarter forecast for 2003. Mark Parsons studied five years of fourth quarters before submitting his winning fourth-quarter forecast for 2003.
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The winner of The Blade s Pick the Dow contest for the fourth quarter of 2003 used fairly precise methodology to come up with his forecast.

“I looked at how much the Dow had gone up in the fourth quarter [in recent years]," said Mark Parsons, a 36-year-old assistant professor of military science at the University of Toledo who is a captain in the U.S. Army. “I calculated about five years [of data].”

That tactic paid off for Captain Parsons, who wins $100, beating out nearly 200 other contestants with his winning prediction. The Toledoan predicted the Dow Jones industrial average would end 2003 at 10,428.62. It actually closed the year about 25 points higher, at 10,453.92. The next closest entry, 26 points off, was submitted by Toledoan Jeff Okonski, whose guess was 10,479.99.

In previous quarters, winners forecasts were closer to the mark - off by less than 1 point, less than 5 points, and by 8 points. The Dow ended 2002 at 8,341.63, fell 4 percent to 7,992.13 in the first quarter of 2003, gained 12.4 percent to 8,985.44 in the second quarter, and gained another 3.2 percent to 9,275.06 in the third quarter.

This time around, only a few contestants believed the Dow would soar in the fourth quarter. Although guesses for the Dow s finish generally ranged from just under 7,000 to nearly 12,000, only 34 entrants believed the Dow would close above 10,000, and of those, only 11 forecast year-end closes over 10,400. The Dow gained 12.7 percent.

And that proved Captain Parsons right. From 1998 to 2002, in good stock-market years and bad, the Dow gained in the fourth quarter, every time, averaging about 11 percent.

The man who was an economics major at Ohio State University said he follows the markets, and his investments are mostly in a Standard & Poor s 500-company index vehicle. He said he researched the Dow s fourth-quarter history on the Internet.

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