I am a big football fan, so I won’t pass up the opportunity to tell you about how the stock market has interacted with results of the Super Bowl over the past few decades. The bottom line is that you really, really want to root for the San Francisco 49ers as an investor, even if your heart is with the Baltimore Ravens.
Bespoke Investment Group studied the average performance of the S&P 500 from the Super Bowl through yearend based on whether a team from the AFC or the NFC wins the game. In the 21 years where the AFC has won the Super Bowl, the analysts report, the S&P 500 has averaged a gain of 3.44% for the rest of the year, with positive returns 61.9% of the time. When the NFC has won the game, however, the average change of the S&P 500 from the Super Bowl through year end is triple the AFC’s average, at +10.37%, with positive returns 80% of the time. (The 49ers represent the NFC this year, while the Ravens represent the AFC).
Since the first Super Bowl in 1967, the S&P 500 has averaged a gain of 7.21% from the game through year end, with positive returns 71.7% of the time. So there has certainly been a bias on the part of the bulls for the NFC.
Next, Bespoke looked at all NFL teams who have won the Super Bowl more than once (as well as the Ravens who won the game once in 2001). In the five years where the San Francisco 49ers won the Super Bowl, the S&P 500 averaged a gain of 20.2% for the rest of the year, with positive returns four out of five times. The only year where the S&P 500 traded down following a 49ers victory was in 1990 (-6.6%) when they beat the Denver Broncos. In contrast, the Baltimore Ravens have only won the Super Bowl once, in 2001. Following that victory, the S&P 500 declined 15.3% from the game through year end.
I cannot think of a single reason why there should be such a contrast between the NFC and AFC victory totals, but sometimes it seems like the market gods have a very elaborate game plan that they keep hidden from us mere mortals.
All you can do is shrug your shoulders and say, “Go Niners!”
InvestorPlace advisor Jon Markman operates the investment firm Markman Capital Insight. He also writes a daily swing trading newsletter, Trader’s Advantage which aims to capture profits of 15% to 40% and often as much at 100% to 200% in less than 90 days.
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