Super Bowl Effect on the Stock Market

The Super Bowl attracts millions of viewers as one of the most watched events of the year. Not just sports fans, but investors take a keen interest in determining the stock market’s direction by watching the famous “Super Bowl Indicator.”

This nonscientific barometer of the stock market was introduced by sportswriter Leonard Koppett in 1978. It suggests that a Super Bowl win for an American Football Conference (AFC) team (this year it was supposed to be my beloved Buffalo Bills, but hey, just sayin’) predicts a bear market for the coming year, while a National Football League (NFL) win predicts a bullish market.

Truth is, there is no reason to believe that the winner of a football game can accurately predict the outcome of the stock market.

This craziness started when New York Times sportswriter, Leonard Koppett, noted that the Super Bowl outcome of the market was predicted accurately with a correlation of 11 out of 12 games until that point. Regardless of its obvious 90% accuracy, there is absolutely nothing to suggest that a correlation implies causation; that just makes no sense whatsoever. That said, it can be more than just a fun indicator as, through 2023, the measure of the S&P 500 still held a 68% success rate. It failed in 2008 when the New York Giants took the title, supposedly a bull market, but saw one of the largest downturns since the Great Depression. However, down markets failed to materialize in 2016 and 2017 when the Denver Broncos and New England Patriots, both AFC teams, won the Super Bowl. 2022 was another failed indicator when the LA Rams should have led market gains but instead lost 20%. From 2004 through 2023, the Super Bowl Indicator was correct only six out of 20 times, hardly a leading indicator.

To date, since its inception, the Super Bowl Indicator does enjoy a cumulative success rate of about 70%. Would you trust your investments to such a lame gauge? I sure would not.

Even if you are not a football fan, it is fun to watch and see how it plays out. We, as a society, are obsessed with this game. Last year, the Super Bowl drew 123.7 million viewers. In comparison, the all-important governance debate between former President Donald Trump and Vice President Kamala Harris scored almost half at only 67 million viewers. Are we suggesting our priorities are more aligned with a hot football game and cold beer than with high-stakes immigration, economic and foreign policy, crime and more?

We professional traders at Day Trade SPY have a set of indicators that are much more predictable. When used properly, we engage with the 10 and 20 exponential moving averages on multiple time frames, along with other key components of our setups to provide exceptional opportunities, multiple times a day. That should excite you more than the half-time show with rapper Kendrick Lamar.

To be clear, no one can predict where the market will be at the end of the year, or even at the end of the week. But our indicators are very accurate with predicting what will happen today. Funny thing is, proper day trading is not only more profitable but also much more fun. I believe it is even more entertaining than watching a bunch of overpaid athletes chase an odd-shaped ball. But that’s just me. All jesting aside, I did play football in my youth.

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Hugh