JP Morgan use Banking Prediction Methodology to Predict World Cup Winner

City analysts have used the 2010 World Cup as a means to demonstrate how their “Quant Methodology”, used to predict banking scenarios and trends, can be used in the real world. Their software predicts that the World Cup will actually be won by bookmakers’ third favourites England.

Quant methodology uses mathematical data to predict things like investment opportunities, but in an attempt to show how it works JP Morgan ran the methodology on the World Cup, the idea being to introduce it to people in a familiar field where statistical information is in rich supply. Whilst JP Morgan say they believe Brazil to be the strongest team, due to the fixtures schedule the methodology shows England to be the eventual outright winners, beating bookies’ favourites Spain in the final with Holland coming in third place. Brazil do admittedly face a much tougher group round than England – where Brazil face the African favourites the Ivory Coast and Portugal, England take on the USA, Slovenia and Algeria.

England haven’t won the World Cup since 1966, and despite usually fielding a good team they have a rich history of underperforming in major tournaments and going out on penalties. They have also had less than the best luck on the injury front going into this tournament, with Beckham and potentially Gareth Barry ruled out. Despite all of this, JP Morgan’s process still calculates that they will emerge victorious.

The men behind the experiment at JP Morgan, Marco Dion and Matthew Burgess, do say that their predictions should be taken with “a pinch of salt” and the idea was to explain Quant methodology in a familiar and fun way, however given the approach is used widely in the City, surely it is as good as any other system for predicting the outcome?

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