The Super Bowl Indicator – Did the Philadelphia Eagles Supercharge the Market?
The Super Bowl has become an American Holiday. Last year’s Super Bowl, a closely contested match between the Kansas City Chiefs and San Francisco 49ers that went into overtime, attracted over 123.7 million viewers, setting a new world record and was crowned the most watched program in American Television history. Some people watch the event for the action on the field or the player/pop star girlfriend storylines leading up to the game. Others watch for the great commercials or the halftime show. Some even hope that the outcome of the big game can forecast things to come in the market for the year, and possibly provide them with an edge to better position their portfolio for the future. So, with the Eagles taking home the title last night, let’s discuss the Super Bowl Indicator and what that means, or doesn’t for the markets in 2025.
The Super Bowl Indicator was created in a 1978 New York Times article by sportswriter Leonard Koppett as a market predictor along the lines of Punxsutawney Phil predicting the timing of Spring or the Psychic Octopus that tried to predict the winner of Germany’s World Cup games in 2008. The Super Bowl Indicator attempts to correlate the outcome of the Super Bowl with annual stock market performance. The Super Bowl indicator suggests that if an AFC team wins, the stock market might go down by the end of the year. On the flip side, if an NFC team wins, things could be looking up for the stock market. Like reading the tea leaves with other non-scientific indicators, investors can rightly assume there have been mixed results using this methodology (if you can call it that). Based on last night’s outcome, it looks like we’re destined for a repeat of 2024 with the indicator predicting another market rally.
At first glance, the data seems to actually back up this theory. As measured by the performance of the S&P 500, 41 out of 58 times, or a 71% rate, the market has performed in line with the theory that whoever won or lost the Super Bowl determined which way markets would finish for the year. Interestingly, this indicator (imperfect but largely accurate before the dot-com era with a success rate of over 90%) has since become a much less accurate predictor of stock market success. The reality is that this so-called indicator is less about correlation (the relationship between two independent events), even less about causation but all about coincidence. However, recent years have seen the indicator falter. From 2004 to 2024, the indicator proved correct only six out of 21 times, challenging its historical reliability. While the indicator had a commendable track record, contrarians may now consider it a bad thing that the Eagles won. The Chiefs Super Bowl wins in 2023 and 2024 coincided with S&P 500 returns of 24.23% and 23.31% respectively.
A better way to look at these and other fun coincidences is they’re really just for entertainment. Unlike the usual things that affect the market, like how well businesses are doing or how confident people are in spending money, the Super Bowl result doesn’t really matter much. People think it’s just a funny coincidence and doesn’t help predict anything; in fact, it didn’t work out in seven of the last eight seasons. Remember, making smart money choices is different from taking a gamble, so it’s better to rely on important factors for your financial decisions. Revisiting your plan or strategy should come with changes to your life or situation, and not trying to ease feelings of uncertainty from the markets by making decisions based on what team won on Sunday.
As a means of predicting the stock market, the Super Bowl Indicator is completely irrelevant: There’s no reason to believe that the winner of a football game dictates the performance of the stock market. One thing I am fairly certain of as a Jets fan, with the 2024-2025 NFL season now in the books, we’ve extended our record for consecutive years feeling disappointed in February.
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