Question

The Super Bowl Indicator Theory suggests that the stock market will have a positive year if the team in the National Football Conference, or a team with an NFC origin, wins. If the American Football Conference team wins, the market will fall. According to the recent news (MarketWatch, 2/6/2017), it has accurately predicted the direction of the market for the year following 40 of the 50 Super Bowls since the first super bowl in 1967. Why do we have such phenomena? Is the finding consistent with market efficiency? Please explain...I may have further questions..

Answer 1

Correlation does not imply causation.

S&P 500 Performance Over the Last 10 Super Bowls  

Year	Winner	League	Conference	S&P 500 Price Return	Prediction
2018	Philadelphia Eagles	NFC	NFC	-6.24%	Wrong
2017	New England Patriots	AFL	AFC	21.83%	Wrong
2016	Denver Broncos	AFL	AFC	11.96%	Wrong
2015	New England Patriots	AFL	AFC	-0.73%	Right
2014	Seattle Seahawks	Expansion team	NFC	13.69%	Right
2013	Baltimore Ravens	Expansion team	AFC	32.39%	Wrong
2012	New York Giants	NFL	NFC	16.00%	Right
2011	Green Bay Packers	NFL	NFC	-1.12%	Wrong
2010	New Orleans Saints	NFL	NFC	15.06%	Right
2009	Pittsburg Steelers	NFL	AFC	26.46%	Right
2008	New York Giants	NFL	NFC	-37.00%	Wrong

As a means of really predicting the stock market, the Super Bowl Indicator is 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 about it for the past four decades.

From 2007 to 2017, the Super Bowl Indicator went 50-50 in predicting the up-down performance of the market, the same as a coin flip. 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.

It's true that it has had a success rate of 80% at some time in the past but the findings are not consistent with the market efficiency at all times. Most expert think of this view as baseless and don't talk about it.

At the end look back at the first line of this answer .Such phenomenas are just game of chance and don't have significant market correlation.