Will the Super Bowl shape the direction of the stock market in 2016?

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When you sit down to watch the Super Bowl later this week, taking note of who wins might just set you up for trading success! You see, there is a certain notion out there called the ‘’Super Bowl Indicator”. No, it’s not based on any fundamental or technical analysis – nor volume for that matter either. Instead, a very simple rule – the direction of the market will depend on whether a team from the AFC or the NFC triumphs on the day – if an AFC team wins, markets are placed to decline for the year; however, if an NFC team wins, a rally is on the cards to see the year end higher. And with many newspaper columns jumping on the trend in recent years, there is certainly no shortage of attention being payed.

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Sound far-fetched? Perhaps, however, one only needs to look at history to gauge the “Super Bowl Indicator” has been far more reliable than many analysts and economists, plus it has been on the money for the last 6 consecutive years. To demonstrate the reliability, it is worth observing that this theory has been correct in 39 out of 48 years – coming in at 81%, it’s hard to argue that it hasn’t been accurate! Furthermore, across 40 years, the market has climbed 75% of the time following an NFC team winning the Super Bowl. With those odds, it’s safe to say that if you’re hoping for a rally on Wall Street in 2016, you’ll be rooting for the Carolina Panthers.

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So as you sit down to watch the Super Bowl this Sunday, not only could the game take on a bit of extra importance but who knows, you might very well find yourself rooting for a different team on the day!