Soccer Affects the Stock Market

A Dartmouth study finds that a country’s stock market is affected by its national soccer team.

Match results may “have an important effect” on share prices, Professor Diego Garcia said, commenting on a report released by Tuck School of Business at Dartmouth this week. “There are forces influencing our economies that have little to do with rational thought.”
Stock markets decline 0.39 percent on average after the national team loses in a World Cup game and 0.29 percent in any international match, according to the study, co-written by Massachusetts Institute of Technology’s Alex Edmans and Norwegian School of Management’s Oyvind Norli.
The correlation is the highest in countries with the biggest public support for soccer such as England, France, Germany, Italy and Spain, the report said. In South American nations, the phenomenon is similar, it said.
Soccer “may have an effect on the market since it affects sentiment,” Richard Hunter, head of U.K. equities at Hargreaves Lansdown in Bristol, England, said in a telephone interview today. “Psychology is pervasive in markets.”
Still, there’s no evidence to show that stock markets rise when teams win, the study said.

You can download the paper here.

Posted by on November 2nd, 2005 at 10:05 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.