Super Bowl Indicator

What Is the Super Bowl Indicator?

The Super Bowl Indicator is a non-scientific stock market barometer. The premise of the Super Bowl indicator is the theory that a Super Bowl win for a team from the National Football League’s American Football Conference (AFC) foretells a decline in the stock market (a bear market) in the upcoming year. Conversely, a win for a team from the National Football Conference (NFC), as well as teams from the original National Football League (NFL)–before the merger of NFL and American Football League (AFL) in 1966–means the stock market will rise in the coming year (a bull market).

Leonard Koppett, a sportswriter for The New York Times, first introduced the Super Bowl Indicator in 1978. Up until that point, the Super Bowl Indicator had never been wrong.

Understanding the Super Bowl Indicator

At one point in time, the Super Bowl Indicator boasted a more than 90% success rate in predicting the up-or-down outcome of the S&P 500 in the following year. However, the old maxim applies: correlation does not imply causation.

The indicator has one very glaring caveat: It counts the Steelers, a team with an NFL-leading six Super Bowls in all, in the NFC, because that’s where the team got its start back in 1933, as an original NFL franchise. It seemingly doesn’t matter that Pittsburgh won all its Super Bowls as an AFC team. Skeptics note that the Steelers won 27% of the Super Bowls by the time it claimed its third for the 1978 season, the year the index got its start. Some argue Koppett included the caveat about original NFL teams from the AFC counting essentially as NFC teams within the indicator for this reason.

As of January 2020, the indicator has been correct 40 out of 53 times, as measured by the S&P 500 Index. This is a success rate of 75%. It failed to predict a down market in both 2016 and 2017, when the Denver Broncos and New England Patriots, both original AFC teams, won Super Bowls. Also of note, in 2008, despite the New York Giants (NFC) winning the Super Bowl, which supposedly indicated a bull market, the stock market suffered one of the largest downturns since the Great Depression.

The Super Bowl Indicator is an example of purely fun sportswriting. There is no real connection between a football team in a particular league and the U.S. stock market; so, any relationship that can be drawn between the two is purely a coincidence. What began as an interesting news column many decades ago continues to make a new headline at least once a year.

However, as a means of predicting the stock market, the Super Bowl Indicator is completely irrelevant: There’s no reason to believe the winner of a football game dictates the performance of the stock market. However, that hasn’t stopped people from talking and writing about it for the past four decades.

S&P 500 Performance Over the Last 10 Super Bowls