After winning the World Series on Monday in five games over the Texas Rangers, the San Francisco Giants were treated to a ticker-tape parade with a turnout of more than one million on Wednesday.
Equity analysts say Giants fans and others may have more to cheer about if certain historical market trends prove true this year.
According to S&P Capital IQ data, the World Series win by the Giants – members of the National League – means the markets are poised to do better in 2011 than they would with a Rangers victory.
Based on the 30 series won by a NL team since 1926, the average S&P 500 return was 15% for the year following a NL victory vs. an average of 9% for the 43 years that followed a series won by the American League.
In the fourth quarter, when a NL team won, the average gain was 4.2%. The markets rose an average of 6.2% in up years and declined 10.2% on average in down years.
When an AL team won, the fourth-quarter saw an average overall return of 2.8%, with gains of just 0.1% when the markets were up and losses of 10.4% when the markets were down.
“There have been more years with American League teams winning,” said Richard Peterson, a director of S&P Capital IQ.
Historically, a five-game series has seen average market returns of 17% for the year following the World Series but just 1.8% for the fourth quarter.
When the series ended in the fifth game and a NL team won, the average gain was only 0.6%, Peterson says.
“Hopefully we will go against this tradition,” Peterson said in a phone interview Friday.