The Super Bowl Indicator

I have heard various versions of this over the years. I am not proposing that you use this legend as a way to invest your money. In fact, quite the opposite, you should only invest best on solid analysis of the company and have some mathematically pure methods of estimating the pricing points. However, with the game today, it is fun to think about this.

I don't know what the outcome of today's game will truly bring. The Indianapolis Colts are one of the oldest teams in professional football as they were originally part of the NFL as the Baltimore Colts. This lineage says that they should be a NFC team but today they represent the AFC. The Saints are an expansion team and have always been in the NFC. So with the legend, they would both be considered NFC teams - so maybe the bull market is a sure thing!

I think that I know some mutual fund managers that have not predicted the market as well as this technique though!

I picked this up over at Snopes.com.  You can go there to read more about what they said.

Want to know if the bulls or bears will be rampaging through the market this year? Popular wisdom says look to the Super Bowl for the answer because a seemingly startling correlation appears to exist between who wins the big game and how the market will perform in that calendar year. According to the "Super Bowl Indicator," a triumphant team from the old American Football League (now the American Football Conference, or AFC) foreshadows a down market, but a winner from the old NFL (now the National Football Conference, or NFC) means dust off your red cape, because the bulls are coming.

The Super Bowl Indicator (SBI) has been on the money 32 years out of 40, which represents a success rate of 80%.1 Between 1967 and 1997 it was accurate 28 times out of 31 (a better than 90% average); it then hit the skids, going 0-4 between 1998 and 2001, but rebounded by being correct 4 years out of 5 between 2002 and 2007.2

Due to league expansion, franchise moves, and conference shifts, the SBI has posed some interpretive problems in recent years as fewer and few Super Bowls pit former AFL teams against old-line NFL teams. Both the 2003 and 2004 championship games featured post-merger expansion teams (the Tampa Bay Buccaneers and Carolina Panthers) and the 2007 contest was waged between two original NFL teams (the Colts and the Bears).

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