It's the most wonderful time of the year.

That's right -- it's that time when everyone on Wall Street comes out to make their market predictions for the year ahead. Heck, I've even made a big one myself.

But even though it's fun to read about these predictions, you're better off leaving most of this advice on the table.

Why? Because the process is flawed. I'm about to share with you three reasons why the process is messed up, and then tell you what advice would suit you well for 2010.

The flaws abound
1. The main reason you shouldn't give much heed to anyone's 2010 predictions is that the short-term moves of the market are unknowable.

No one -- no analyst, no economist, no politician, no academic, and no investor -- predicted with precision the 27% drop in the S&P 500 from Jan. 1, 2009, to March 9, 2009. And -- even worse -- no one then predicted with precision the 64% jump that followed those March lows. Or that stocks like Cell Therapeutics (NASDAQ:CTIC), Human Genome Sciences (NASDAQ:HGSI), Conseco (NYSE:CNO), and Netlist (NASDAQ:NLST), which plummeted during 2007 and 2008, would all shoot up more than 1,000% from those same March lows.

And it wasn't unique to the past year. At the start of 2008, Wall Street's top market forecasters predicted an 11% rise in the S&P. If you remember, the S&P closed down 38% that year.

All of this means that the current consensus of a 12.5% stock market rise in 2010 should be taken with a grain of salt.

2. The second reason you shouldn't give much heed to predictions for 2010 is that the forecasters will alter their predictions as the year unfolds.

At the end of 2008, Wall Street's top strategists predicted that the S&P would end 2009 at 1,056. Not bad. The index sits just above 1,100 today.

However, as the market began its 25% tumble during the first quarter of '09, these strategists lowered their estimates down to around 950. So not only do they have the unfair ability to change their predictions as time passes (which defeats the purpose of the prediction in the first place), but this only exacerbates the short-term-thinking problem I just mentioned.

3. The final reason you shouldn't give much heed to predictions for 2010 is that the forecasters have no accountability for their predictions.

Sure, a few writers like me will call out their wrong guesses. But Wall Street strategists get a pretty easy escape from their blunders. If they are confronted about their wrong guess, they usually explain that the market went haywire -- and not that they were the ones who made the mistake.

What you should do instead
Knowing how much of a joke these predictions are, is there any advice for 2010 that is worthwhile?

There is.                                                                                                                                  

It may not be sexy, and it may not make for a front-page Bloomberg story. But you can spend 2010 perfecting your portfolio for the long term.

By that, I mean that right now is a perfect time to determine what your core holdings are, whether you're well-diversified, and where you'll send new money each month throughout the coming year.

Your core holdings should be stocks of companies you know well and are comfortable holding for the long term, while being able to sleep soundly at night. Smart diversification among market cap, sector, and country will help even out short-term volatility. And continuing to add new money each month to the market's best opportunities will ensure that your savings continue to grow at above-average rates.

This is exactly what David and Tom Gardner -- co-founders of The Motley Fool and co-advisors of Motley Fool Stock Advisor -- help investors do in their Stock Advisor newsletter.

To give you an insider's look at their thinking … right now, they're advising members to make shares of (NASDAQ:AMZN) a core holding in their portfolios. That's because they believe Amazon is "more than just the best online retailer on the planet," but that it is "revolutionizing the way we buy and use products and digital content." Its e-book reader, the Kindle, is proof of this. And since Amazon's stock was first recommended, it's up an incredible 735%.

As for their top recommendations for new money right now, they're advising investors to snap up shares of companies like InterDigital (NASDAQ:IDCC), a wireless technology company, and Coach (NYSE:COH), the premium handbag and accessory maker. InterDigital's profit tripled in the past quarter, and the cash on its balance sheet now makes up roughly half of its market cap. And Coach is taking advantage of the rising consumer in China.

Of course, these are just three of more than 80 open recommendations David and Tom have made since they founded the newsletter in 2002. And over that time period, their recommendations have outperformed the S&P 500 by an average of 52%. Not bad, especially when you consider that three out of four mutual funds fail to beat the market every year.

If you'd like help perfecting your portfolio right now -- and throughout 2010 -- and are looking for two ideas every month in the coming year, I invite you to check out Motley Fool Stock Advisor. In fact, to determine whether their newsletter is right for you, you can sign up completely free for 30 days. Just click here for more information.

Adam J. Wiederman owns no shares of the companies mentioned above., Coach, and InterDigital are Motley Fool Stock Advisor selections. To learn all about our predictable disclosure policy, click here.