7 Lessons Super Bowl XLII Teaches Investors
Posted by Timothy Sykes on Mon 4th of Feb, 2008 12:12:08 PM
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1. Expect the unexpected: Neither the Giants winning or the low 17-14 final score was expected in the least (Bull markets can’t last forever, stocks DO NOT always trend higher over time)
2. Never trust “experts:” Ex-Giant and “football expert” Tiki Barber was dead wrong when he retired one season too soon while trashing his former teammates and coaches in order to get attention (Don’t listen to “market experts” when they make predictions like Apple (AAPL) $300 and Google (GOOG) $1,000 to get attention)
3. The acknowledged best are not always the best performers: Patriots quarterback Tom Brady, the league MVP, got outplayed by oft-criticized Eli Manning (just because hugely successful companies like Microsoft (MSFT), General Electric (GE) and Goldman Sachs (GS) are leaders in their fields does not mean their stocks will outperform lesser quality rivals)
4. Past performance is not indicative of future returns: For the season, the Patriots came in undefeated, the Giants had lost six games (Wow, this standard SEC disclaimer is actually right on the money for once!)
5. The weakest sometimes become the strongest: Little known Giants wide receiver David Tyree did more in this one game than he had all season, capping his performance off with one of the greatest catches in Super Bowl history (Hurting homebuilders like KB Home (KBH), Toll Brothers (TOL), D.R. Horton (DHI) have been the best performers in the entire stock market as of late)
6. Certain rules are ridiculous: The game was already decided, spectators and press were on the field and Patriots coach Bill Belichick was already in the locker room when two seconds still remained on the game clock, but the NFL made the Giants run one more play (Lots of ridiculous stock market rules: The Pattern Day Trading Rule, hedge fund managers can’t advertise or talk to the press, people in the finance industry are prohibited from reviewing financial books (as I learned with my book)
7. Eyeballs matter: This year, with estimates of 100 million people watching, a 30 second ad cost $2.7 million. (This is why horribly run businesses like Yahoo! (YHOO) can get premium buyout offers)
Disclosure: Giants fan
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