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The Super Bowl Stock Indicator

Wall Street’s wacky indicators should be watched, not used

spinner image Super Bowl 57 quarterbacks Jalen Hurts #1 of the Philadelphia Eagles and Patrick Mahomes #15 of the Kansas City Chiefs, superimposed on a graph and stock exchange board
Mitchell Leff/Dylan Buell/artpartner-images/Getty Images

When you think of Wall Street analysts, you think of people peering at computers, writing earnings estimates, calculating growth rates and price momentum. But they also look at far less rational indicators, such as how stocks fare in January, lipstick sales, the length of skirt hemlines, and the nationality of the cover model for the annual Sports Illustrated swimsuit issue.

The Super Bowl Indicator is the granddaddy of all of Wall Street’s weird indicators. It holds that the team that wins the big game Sunday will determine whether your stock portfolio will have a winning year or wind up in the cellar. What’s a game-winning touchdown got to do with the stock market flashing green? The venerable indicator states that the stock market will end the year with a gain if a National Football Conference team (such as the Philadelphia Eagles) wins the Super Bowl, but that stocks will fall if the American Football Conference team (the Kansas City Chiefs) is the winner. The pigskin-driven theory was promulgated in the late 1970s by Leonard Koppett, a sports reporter for The New York Times.

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And, for the most part, the Super Bowl Indicator’s record has been fairly solid, albeit imperfect, since Super Bowl 1. The Dow Jones industrial average, for example, has finished the year higher 82 percent of the time when an NFC team has hoisted the Vince Lombardi Trophy, and posted an average annual return of 11.4 percent, according to statistics supplied by Sam Stovall, chief investment strategist at CFRA, a Wall Street research firm. The indicator has an overall success rate of 73 percent.

That’s why if you’re watching the Super Bowl this year, “you might want to root for the Eagles,” says Elana Duré, a vice president and head of the content studio for J.P. Morgan Wealth Management.

No reason for it to work

Still, while those success rates are superior to the long odds of, say, winning the lottery or consistently predicting whether the Dow will finish the year up or down, Wall Street pros admit there’s no rhyme or reason the Super Bowl Indicator works or doesn’t work in any given year. In short, the indicator is about as reliable as, well, any other stock market prediction tool.

“This is really a tongue-and-cheek indicator,” Stovall says. “It has correlation but has absolutely no causation.” As a result, diving aggressively into the stock market just because the Eagles beat the Chiefs in Super Bowl 57 is a bit of a stretch, Stovall says. “While the Super Bowl Indicator would imply that markets could fly like an eagle, don’t bet too much green on this indicator,” he says.  

Whether one football team beats another on Super Bowl Sunday, of course, has little to do with the normal drivers that propel stock prices up and down. These drivers include things such as the growth rate of the economy and corporate earnings, equity valuations, the level of consumer confidence, or how peppy (or depressed) the sales of goods and services are.

“Considering it’s completely independent from any financial or economic conditions, it’s not exactly something I would put a lot of confidence in,” says Andrew Wood, a retirement planning adviser at Dan White & Associates, a financial planning firm. “In terms of predictive value, it’s much more of a coincidence than anything.”  

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No kidding. In recent years, the Super Bowl Indicator has been far from infallible. In six of the past seven Super Bowls, the indicator has been wrong. During that time, it failed to predict the market’s outcome in the five years between 2016 and 2020. It was right in 2021 but misled investors again last year.

Last year, when the NFC’s Los Angeles Rams won the NFL’s top prize, the Dow tumbled 9.3 percent. The Dow also fell 5.6 percent back in 2018 when the NFC’s Eagles last won the Super Bowl.

And a Super Bowl win for an AFC team hasn’t been bearish for stocks in recent years, either. The past four times an AFC team was crowned as champs — the Chiefs in 2020, the New England Patriots in 2019 and 2017, and the Denver Broncos in 2016 — the blue chip stock gauge finished the year up 7.3 percent, 22.3 percent, 25.1 percent and 13.4 percent, respectively.

Those big misses are why J.P. Morgan’s Duré says basing investment decisions on the Super Bowl Indicator is akin to gambling.

Just for fun

A better way to treat the Super Bowl Indicator is as a form of entertainment, no different than voting on your favorite 30-second Super Bowl ad, hoping you cash in on a winning square or box, or rooting for the Eagles to win just in case the indicator is 100 percent correct this year, says Wood, a self-described Eagles fan.

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“This year, we’ve got Chiefs versus the Eagles — red versus green,” Wood says. “I’d love to see an Eagles victory and the markets finish green at the end of the year.”

An Eagles win might also signal better days ahead for the economy generally, according to Megan Horneman, chief investment officer at Verdence Capital Advisors. Her research shows that “recessions are more likely with [an] AFC win.” Since 1969, the U.S. economy has gone through eight recessions, six of which started in a year the AFC won the Super Bowl. “Again, go Eagles!” Horneman says.

Arizona, the state hosting this year’s Super Bowl, has also proved an accurate adjunct for the Super Bowl Indicator. In the three previous Super Bowls played in the Grand Canyon State, the AFC won two of those games, and the broad U.S. stock market was negative both years, including a 38.5 percent loss in 2008. When the NFC’s Dallas Cowboys beat the AFC’s Pittsburgh Steelers in 1996, the S&P 500 stock index rose more than 20 percent.

“While we never take historical sports comparisons as a viable resource when evaluating investment opportunities, history gives some fun talking points as we tune in to watch the big game,” Horneman says.

Wacky Wall Street Indicators

Wall Street handicappers have been searching for patterns, indicators and clues to where equity prices are headed next for eons. And this pursuit of an edge began long before the Green Bay Packers defeated the Chiefs in the first Super Bowl in 1967. Here’s a look at some of Wall Street’s oddest indicators.

The Lipstick Indicator. This is an economic indicator, and not a happy one. The indicator holds that when lipstick sales rise sharply, times are getting tougher. People might not want to pay for a new car or a designer purse, but new lipstick is a small luxury that makes you feel better and doesn’t cost much. The idea came from Leonard Lauder, billionaire heir to the Estee Lauder fortune. 

The Big Mac Index. Created by The Economist, the Big Mac Index measures whether currencies are over- or undervalued, relative to the U.S. dollar. The logic: A Big Mac is pretty much the same everywhere. If the price of a Big Mac in, say, Sweden is higher than in the U.S., then the Swedish kroner could be overvalued.

Men’s underwear index. This theory, a favorite of former Federal Reserve chair Alan Greenspan, is that men don’t buy as much underwear during a recession.

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