what is ex ante 
ex ante refers to future events that are based on forecasts or predictions rather than concrete results translated from latin it means before the event ex ante can be used to describe the potential returns of a particular security or company much of the analysis conducted in the markets is ex ante focusing on the impacts of long term cash flows earnings and revenue while this type of ex ante analysis focuses on company fundamentals it often relates to asset prices forecastingin finance any prediction or forecast ahead of an event before market participants become aware of the pertinent facts is ex ante research or analysis that financial professionals conduct is generally considered ex ante the information they provide in their reports isn t based on actual results because the event hasn t yet happened predictions are often based on a company or security s historical performance and may include outcomes in an ex ante analysis are not known for certain but making a prediction sets an expectation that serves as a basis of comparison versus reported actuals types of ex ante analysisinvestors commonly use ex ante earnings per share eps analysis in the aggregate consensus estimates help to set a baseline for corporate earnings it s also possible to gauge which analysts among the group covering a particular stock tend to be the most predictive when their expectations are notably above or below those of their peers analysts may also provide ex ante predictions when a merger is widely expected but before it takes place such analysis takes into account potential cost savings related to paring redundant activities as well as possible revenue synergies brought about by cross selling there s considerable uncertainty related to fundamental company performance following a merger the merger is the initial event but the ex ante analysis makes projections related to the next major upcoming event such as the first time the combined firm reports earnings it s often impossible to account for all the variables for every form of ex ante analysis the market sometimes behaves erratically that s why price targets that account for many fundamental variables sometimes miss the mark due to exogenous market shocks that affect nearly all stocks ex postex post is the opposite of ex ante it s latin for after the event and compares expectations versus actuals once the ex ante analysis s event passes looking back at predictions ex post helps to refine them going forward analysts and investors can use historic returns to make predictions on the performance of investments and companies as such any risks that an investor or other individual may experience in the future can be determined using statistical measurements based on the investment s long term returns investors advisers and analysts can use ex post analyses to calculate the largest scope of losses possible this doesn t include future market swings abnormalities or other unexpected events that may take place advantages and disadvantagesex ante analyses use past performance and allow investors and companies to better prepare themselves for every possible outcome of investing whether that s positive or negative using historical data makes investors analysts and companies more prepared to make important investment decisions however this type of analysis is only a prediction and isn t based on actual results as such it doesn t provide any concrete determinations nor does it account for unexpected events such as market swings investor sentiment or other surprising industry news investors and companies can prepare themselves for every possible outcomeuses past performance as its basishelps investors make better and more informed investment decisions