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Sorry, New England: A Pats Super Bowl win might be bad for the economy

Posted by Alex Pearlman  January 29, 2012 10:08 AM

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stock market trends.jpgBy Kevin Clang

The stock market can be as fickle as an exhausted toddler. Investors make and lose millions trying to predict yearly trends so they can buy and sell choice stocks at the exact right times. Over the years, some analysts have noticed coincidental patterns and created many superstitions as a result. And one of the most reliable of these trends concerns the NFL. If there is an invisible hand that guides the stock market, it may belong to an NFC fan.

As the adage goes, if an NFC team or an original National Football League (pre-1970 AFL merger) team wins the Super Bowl, the stock market is poised for a rising "bull" year in the Dow Jones Industrial Average; an AFC win indicates a declining "bear" market. For example, the Dow enjoyed an average annual return of 5.5 percent when the NFC's Green Bay Packers won the Super Bowl last year. When our New England Patriots, an AFC team, beat the St. Louis Rams in 2002, stocks lost an average of 16.8 percent over that year.

Since the first Super Bowl in 1967, this superstition has held true 80 percent of the time (36 for 45); prior to 1997, the indicator was correct 28 times in 31 years, including going 12 for 13 between 1984 and 1996. Lucky for investors, in 40-plus years of Super Bowls, AFC teams that were not originally part of the NFL have won just a dozen times.

Still, whether or not a Patriots win historically hurts the economy is debatable. Of the six seasons the Pats have made it to the Super Bowl, the theory has held true four times; Brady & Co. beat Carolina in 2004, a bull year, and lost to the Giants in 2008, the third-worst year on record. In the four years where the Super Bowl indicator has held up, New England is 2-2, and stocks have gained a net total of 27.8 percent. But if you count all six Super Bowl seasons, stocks have lost a net total of 7.94 percent.

Expanding this pseudoscience even further, the stock market may be able to tell us a few things about the 2012 Super Bowl winner. According to a separate superstitious barometer, as goes January, so goes the year. Since 1945, the market has finished positive in 85 percent of years in which it gains in January. Though the month isn't over yet, estimates last week had the Dow slightly up, gaining .06 percent over the past week, mostly thanks to a good performance from Apple.

For New England fans who also believe in Bigfoot and astrology, these findings could be bad news: If the Dow finishes ahead next week and the so-called "January Effect" holds up, the market would finish slightly in the green in 2012 -- an indication of an NFC Super Bowl win. That's a lot of ifs, but it's the best we've got. So wear your lucky jersey next Sunday; the Patriots may need it.

It's true that correlation does not necessarily imply causation, and anyone who is actually thinking about trading stocks on this superstitious information should probably have his head examined, but if you've got 20 bucks to spare, all this info may help you win your office pool.

Photo by photophonic (Flickr)

About Kevin -- I've spent the past three years honing my journalistic skills, telling people's stories across various forms of media, helping launch an online television network, learning all aspects of social and new media, editing a Student Emmy Award-winning sports show, planning and running concerts for nationally recognized artists, and recruiting volunteers for a candidate for the U.S. House of Representatives. I'm focused on bringing traditional media into the future. Twitter: @kevclang

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