Your retirement could impact the Super Bowl outcome…

Will your 401(k) be bitten by the Bengals or will it go with the Rams?

That’s what followers of the so-called Super Bowl indicator[1] would probably conclude, after all. It’s a “theory” that when a team from the former National Football League wins the Super Bowl, the S&P 500 rises, and when a team from the former American Football League wins, stock prices stocks fall.

It’s a “theory” that’s been proven correct almost 80% of the time, for 41 of 55 Super Bowls, in fact. And of course, last year’s win by the NFC’s Tampa Bay Buccaneers bolstered that notion, as the S&P 500 gained ground.

Not that he didn’t have his faults. There is no need to look back more than the previous year’s win by the AFC’s (and original AFL’s) Kansas City Chiefs over the then-champion San Francisco 49ers. NFC to refute applicability (or did your 401(k) miss that 18.4% rise in the S&P 500?). Or how about the year before when the New England Patriots of the AFC (formerly the Boston Patriots of the AFL) defeated the NFC champion Los Angeles Rams (who , of course, do another run this year) – when the S&P 500 rose more than 30% in 2019.

Or, looking the other way, the year before, an NFC champion Philadelphia Eagles victory over the AFC champions Patriots turned out to be a loser, from a market perspective, with the S&P 500 down more than 6% (although for most of the year it was a different story altogether). Ditto the year before, when the epic comeback of those same AFC champion Patriots against the then-NFC champion Atlanta Falcons failed to prevent a market surge in 2017.

Now, one would think that the real “spoiler” for this market “theory” is the New England Patriots – but the previous year, the Broncos’ 24-10 win over the AFC (and AFL original) on the Carolina Panthers, who represented the NFC, also turned out to be an “exception”.

Market creations

You might well wonder why, given this consistent series of “exceptions” we still talk about this “theory” – but, it turns out to be an unusual (albeit consistent) break in the streak that was maintained in 2015 after Super Bowl XLIX, when the AFC’s New England Patriots (yes, they show up a lot) defeated the Seattle Seahawks 28-24 to claim their fourth Super Bowl title Bowl.

It also “worked” in 2014, when the Seahawks knocked out the Denver Broncos’ legacy from the AFL, and in 2013, when a dramatic fourth-quarter comeback saved the Baltimore Ravens victory, which, although representing the AFC, are technically a legacy of the NFL. team via their Cleveland Browns roots (this is where things start to get confusing, as the Ravens, who used to be the Browns, moved to Baltimore in 1995 (although the NFL still considers them an expansion team) filling the hole left by the then-Baltimore Colts’ 1984 “overnight” move to Indianapolis.

Admittedly, the fact that the markets did well in 2013 was not a real test of the Super Bowl theory since it turned out that the two Super Bowl XLVII teams – the Ravens and the San Francisco 49ers – were legacy NFL teams.

However, consider that in 2012, a team from the old NFL (the New York Giants) faced – and eliminated – a team from the old AFL (the New England Patriots – yes, those New England Patriots…one more time). And, actually, 2012 was a pretty good year for stocks.

Steel “curtains”?

On the other hand, the previous year the Pittsburgh Steelers (representing the American Football Conference) faced the Green Bay Packers of the National Football Conference, two teams that had some of the oldest, deepest and , yes, the most “historic” of the NFL. , with the Steelers formed in 1933 (as the Pittsburgh Pirates) and the Packers founded in 1919. According to Super Bowl theory, 2011 should have been a good year for stocks (because whoever wins, a team inherited from the NFL would prevail).

But as some may recall, as the Dow gained ground for the year, the S&P 500 was, well, flat (dare we say “deflated”?).

And then there was the Super Bowl series where the competitions were all between legacy NFL teams (so no matter who won, the markets should have gone up):

  • 2006, when the Steelers beat the Seattle Seahawks;
  • 2007, when the Indianapolis Colts (those old Baltimore Colts) beat the Chicago Bears 29-17;
  • 2009, when the Pittsburgh Steelers played the Arizona Cardinals (formerly the St. Louis Cardinals of the NFL); and
  • 2010, when the New Orleans Saints beat the Indianapolis Colts, which, as we’ve already noticed, had roots going back to NFL heritage, the Baltimore Colts.

Indeed, the markets were higher in each of those years.

As for 2008? Well, that was the year the NFC’s New York Giants dashed the hopes of the AFL Patriots (yes, those Patriots) for a perfect season, but it didn’t do the stock market a favor. . In fact, that was the last time the Super Bowl theory didn’t “work” (well, until the year before—oh, and the year before—and the year after). ‘before…).

Patriot wins

Times were better for Patriots fans in 2005, when they beat the NFC’s Philadelphia Eagles 24-21. Indeed, according to the Super Bowl theory, the markets should have gone down that year, but the S&P 500 rose 2.55%.

Of course, Super Bowl theorists would tell you that the New England Patriots’ victory in 2002 accurately predicted the bear market to continue into a third year (at the time, the first accurate result in five year). But the Patriots’ 2004 Super Bowl victory over the Carolina Panthers (the one no one except Patriots fans and disappointed Panthers defenders probably remember because it was overshadowed by the infamous “malfunction wardrobe”) failed to anticipate a fall rally that helped push the S&P 500 to a nearly 9% gain that year, sacking the indicator for another loss (could not resist).

Bronco ‘Busters’

Consider also that, despite the Denver Broncos’ AFL-legacy victories in 1998 and 1999, the S&P 500 continued its momentum, while the St. Louis Rams’ victories (via Los Angeles) inherited the The NFL (who have since returned to the City of Angels) and the Baltimore Ravens (those former “Browns”) did nothing to dispel the bear markets of 2000 and 2001, respectively.

In fact, the Super Bowl theory “worked” 28 times between 1967 and 1997, then went 0-4 between 1998 and 2001, only to get back on track starting in 2002 (although “purists” wonder still how to interpret Tampa Bay’s 2003 victory, since the Buccaneers spent their first NFL season in the AFC before moving to the NFC).
Indeed, the Buccaneers’ move to the NFC was part of a trade with the Seattle Seahawks, who, in fact, entered the NFL as an NFC team in 1976, but soon shuttled to the AFC (where they remained until 2001) before returning. to NFC.[2] And, having only entered the league in 1976, regardless of when they started, can the Seahawks really be considered a “legacy” NFL team?

Also keep in mind that in 2006, when the Seahawks made their first Super Bowl appearance – and lost – the S&P 500 gained almost 16%.

As for Sunday’s contest, it’s said to be an underdog contest – with bettors believing it was “supposed” to be a contest between the 49ers and the Titans (although the Rams were a favorite early in the season, and therefore probably after a bit of a stumble have redeemed themselves). In fact, this is the first time in Super Bowl history that both teams have entered the playoffs as (only) No. 4 seeds.

The Bengals have appeared in three Super Bowls (counting this one), having lost the other two – in 1981 and 1988 – both to the 49ers (and both by a single score). The Rams, meanwhile, are making their fifth Super Bowl appearance and their second in the last four years. Their last appearance: in 2018 against the Patriots, in what turned out to be the Super Bowl with the lowest score ever (13-3).

Rams coach Sean McVay, just 36, is not just looking for his first Super Bowl win, but if he gets it, he’ll be the youngest head coach to ever lift the Lombardi Trophy. (Steelers coach Mike Tomlin currently holds that accolade for winning Super Bowl XLIII at age 36). On the other hand, Bengals coach Zac Taylor is (only) 38, making them the youngest pair of Super Bowl head coaches in game history.

One final potential point of interest: the Bengals (the home team representing the AFC, even though the game is literally being played on the Rams’ home turf) have announced that they will be wearing black jerseys and white pants with orange highlights and matching socks – in homage to their first Super Bowl appearance (although they lost that game, of course). The Rams will don their retro white jersey, yellow sleeves and royal blue socks. That might matter because, dating back to 2005 with the Patriots in Super Bowl XXXIX, the team wearing white jerseys has won 14 of 17 times.[3]

All in all, and especially given the thrilling playoff games leading up to it, it looks like it should be a good game.

And that, whether you’re a believer in the Super Bowl theory or not, would be one in which no matter which team wins, we all do!


[1] An alternative theory linking the Super Bowl to upside stock performance posits that Wall Street results can be used to predict the outcome of the game. According to this theory, if the Dow rises from late November through Super Bowl game day, the team whose full name appears later in the alphabet will win.

[2] Note: Seattle is the only team to have played in both the AFC and NFC championship games, having moved from the AFC to the NFC during the league realignment prior to the 2002 season. The Seahawks are the only NFL team to have changed conferences twice in the post-merger era. The franchise began play in 1976 in the NFC West division but switched conferences to the Buccaneers after one season and joined AFC West.

[3] Only the Packers in 2010, the Eagles in 2017 and the Chiefs in 2020 bucked this trend.

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