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Super Bowl Indicator: Why a Broncos win will be better for stocks

Breakout

Super Bowl Indicator: Why a Broncos win will be better for stocks

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Super Bowl Indicator: Why a Broncos win will be better for stocks

Super Bowl Indicator: Why a Broncos win will be better for stocks
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Professional traders look to all sorts of crazy things to try to get their heads around the market: hemlines, cardboard box shipments, Presidential cycles, and of course the Super Bowl. As much as investors deride all of them, they still kinda sorta pay attention to them, if only for the fun of it.

To the point, Bespoke Investment Group’s number cruncher Paul Hickey set out to analyze the Super Bowl theory, which unequivocally has shown that when an NFC team wins, the S&P 500 (^GSPC) has rallied an average of 10% in the ensuing 11 months and was positive 80% of the time, which is more than double the 4% gains that follow an AFC victory.

As Hickey explains in the attached video, as much as 47 years of data sampling is sufficient, this year, he’s turned this fabled indicator on its head and says Wall Street really needs to see the AFC Champion Denver Broncos coming out on top. Lest you forget, this Sunday will mark the 7th Super Bowl appearance for Colorado’s famed “Orange Crush.”

As Hickey points out, the two times the Broncos won the big game, in 1998 and 1999, the market actually performed well above its AFC-average, gaining 28 and 15 percent respectively.

In addition, what really has Hickey (an admitted New York Giants fan) pulling for Denver is what has happened when they lose. Specifically, following the Bronco’s last four Super Bowl losses, the market averaged gains of only two percent.

So while history would suggest that investors should be pulling hard for the NFC’s Seattle Seahawks, the smart money is going to be secretly rooting for the Broncos not to lose.

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