The AFC and NFC championships are today and that means we’ll know who is going to the Super Bowl. It will be one of The Bears or the Packers against one of The Steelers or The Jets. Financiers can try to find almost any indicator to predict buying behavior and there is that old Super Bowl Indicator that investors often talk about at the end of January each year. The theory is that an AFC win calls for stocks to decline in a year while an NFC win takes stocks higher. Unfortunately, the indicator is modified now because there are so many more teams in the league.
OK, call it whatever derivative or make fun of it as you will. The odds may be no different than another once a year indicators. Still, some look at this among other things. Investopedia called it surprisingly accurate and threw out an 85% figure of its use.
Bloomberg BusinessWeek threw out some Capital IQ data for last year’s Super Bowl to tease the adventurous minds as well.
After last year’s Super Bowl, Gallup showed that there was no change in its Gallup Economic Confidence reading.
BNET reported last year that The Saints win predicted a win for stocks. That was right, but it is a modified calculation.
In all likelihood, this index is nothing more than a mere coincidental indicator.
The Super Bowl Indicator might be no different than saying, “There were 8 heart attacks at the NYSE trading floor this week, maybe that means it is a capitulation bottom!” Actually, the heart attack angle might be more interesting to track than the Super Bowl Indicator. After all, that could come on any week of the year.
Enjoy the football games this Sunday.
Jon Ogg
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