World Cup Losses add up in Many Ways

January 5th, 2006 | by: WC Bob | Comments Off

In a further sign that academics have way too much time on their hand, a pair of business school professors has found that international football matches have a significant impact on domestic stock markets.

The professors report that when a team losses so does its country’s stock market, especially if it is a World Cup loss. According to the study, stock markets drop 39 basis points on average after a World Cup elimination loss, and 29 basis points after any elimination loss.

Maybe this helps explain why people around the world are choosing to make a different kind of investment: a bet on who they think will win the World Cup.