Listless Nikkei

On 24 July 2020 the Olympic Summer Games will begin in Tokyo, the capital of Japan. Olympic Games and Soccer World Cups are among the largest sporting events in the world.  Do you perhaps also think that these events may affect the performance of local stock markets?


Olympic Summer Games 2020 – official logo (left), and a fan-made logo (right) by designer Daren Newman [PT]


Let us examine whether and in what way such major sporting events impact the stock markets of host countries. As the chart below shows, lately the performance of Japan’s Nikkei 225 Index was not exactly convincing. Could it be that this is soon going to change?


Nikkei 225 Index, 2014 – 2019


The Nikkei’s performance over the past two years has been disappointing.

Source: Comdirect


Generating a Comprehensive Picture with a Large Number of Sporting Events

Soccer World Cups and Summer Olympics take place every four years, staggered by two years. In order to achieve higher statistical significance, these two large sporting events are examined together.

Since 1960 15 Olympic Games and 15 Soccer World Cups have been held. Daily stock prices of the host country markets are available for 22 out of these 30 sporting events. The 2002 Soccer World Cup was hosted by both South Korea and Japan, i.e., it took place in two countries. By using the stock prices of both countries in this case, we can examine the average performance of 23 markets for our study.

The table below shows an overview of all Summer Olympic Games and Soccer World Cups since 1960. It also indicates whether the relevant stock market prices are available.


Summer Olympics and Soccer World Cups since 1960


Since 1988 the stock prices of all host countries are available.

Source: author’s own diagram

We have used US dollar-denominated country indexes for the study, as some local currencies are quite volatile. In short, we have adopted the perspective of an international investor.


Averaging Provides Clear-Cut Information

To examine the impact of these major sporting events, we look at the trend of stock prices around the events. A specific temporal anchoring point is needed, as the events take place at different times of the year (between the end of May and the beginning of October). We use the beginning of the sporting events as the fixed point in time around which we perform the analysis.

In the next step, we average the returns generated by the individual indexes around this fixed point in time. In this way we can gauge whether a typical pattern around major sporting events actually exists.  The average is depicted in the form of a special event chart, which permits us to discern the typical pattern of stock prices around major sporting events at a glance.


Stock Prices Tend to Rise for Many Months Before the Games Begin

The next chart is not a standard stock index price chart. Rather, it shows the average performance of the stock market indexes of all host countries in the time period under review. The vertical axis depicts the percentage by which the indexes rallied or declined on average. Time information is plotted on the horizontal axis.

The beginning of the sporting event is highlighted by a vertical line in the middle of the chart. A total time period of two years is shown, i.e., the year before and the year after the beginning of the event.

In other words, the chart illustrates the average performance of the stock markets of all host countries around a major sporting event over a time period of two years.


Average performance of the stock markets of countries hosting major sporting events, one year before and one year after the event, 1960 – 2018


Major sporting events tend to drive stock prices!

Source: Seasonax

As the chart indicates, the stock markets of host countries typically started to rally approximately 11 months before the beginning of Olympic Games and/or Soccer World Cups. Reasonably good entry points also presented themselves 10 months and 6 months before the beginning of the event.

However, roughly one month before the beginning of the major sporting event stocks tended to enter a strong downtrend that lasted almost six months. Even during the competitions stock prices tended to decline, if only moderately. Prices only began to recover again several months later.


Stock Prices Driven by Media Coverage and Investment

The extent of the average gain from the market low 11 months before the beginning of the sporting event to the initial peak 10 months later amounted to 13.39 percent or 15.78% annualized.

By comparison, the annualized gain of the MSCI World Index between 1970 and 2018 was just 6.35%. Thus the “pre-Olympics phase” generated roughly double the MSCI’s return in the local stock markets of the countries hosting the sporting event.

A number of reasons suggest themselves for the strong rallies ahead of such events: for one thing, major sporting events spur a flurry of public spending. Moreover, they attract a great deal of media coverage. This in turn attracts investors.

However, by the time sports coverage dominates the media close to the beginning of these events, it is already too late to invest. This demonstrates how important it is to be well-informed – which you will be with the help of our tools at or at Bloomberg and Thomson-Reuters.

PS: stay a step ahead of other investors!


Dimitri Speck specializes in pattern recognition and trading systems development. He is the founder of Seasonax, the company which created the Seasonax app for the Bloomberg and Thomson-Reuters systems. He also publishes the website , which features selected seasonal charts for interested investors free of charge. In his book The Gold Cartel (published by Palgrave Macmillan), Dimitri provides a unique perspective on the history of gold price manipulation, government intervention in markets and the vast credit excesses of recent decades. His ground-breaking work on intraday patterns in gold prices was inter alia used by financial supervisors to gather evidence on the manipulation of the now defunct gold and silver fix in London. His Stay-C commodities trading strategy won several awards in Europe; it was the best-performing quantitative commodities fund ever listed on a German exchange. You can find an introduction to the Seasonax app and in-depth information on what it can do here. Furthermore, here is a complementary page on the web-based Seasonax app, which costs less and offers slightly different functionality (note: subscriptions through Acting Man qualify for special discounts – for both the Bloomberg/Reuters and the web-based versions of the app. Details are available on request – simply send a note to with the header Seasonax!).


Charts & tables by Comdirect, D. Speck, Seasonax


Edited by PT




Emigrate While You Can... Learn More




Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.


Bitcoin address: 12vB2LeWQNjWh59tyfWw23ySqJ9kTfJifA


Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • The Hollow Promise of a Statist Economy
      Brainwashed by Academe Not a day goes by that doesn’t supply a new specimen of inane disclarity.  Muddy ideas are dredged up from tainted minds like lumps of odorous pond muck.  We do our part to clean up the mess, whether we want to or not.   No longer in demand: famous Enlightenment philosopher John Locke (1632–1704), who is widely considered the “Father of Liberalism” (classical liberalism, that is). [PT]   These days, individuals, who like John...
  • The Great Debasement - Precious Metals Supply and Demand
      Fiat Money Woes Monday was Labor Day holiday in the US. The facts are that the euro lost another 1.4%, the pound another 1.1%, and the yuan another 0.9% last week.   Assorted foreign fiat confetti against the US dollar – we have added the Argentine peso as well, as it demonstrates what can happen when things really get out of hand. [PT]   So, naturally, what is getting play is a story that Bank of England governor Mark Carney said the dollar’s influence...
  • Hong Kong - Never the Same Again
      Freedom Rock Hong Kong ranks among the freest societies in the world. Not only economically, but socially it is a very liberal place. It was marinated in British ways until 1997, much longer than Singapore and other colonies. Then China took it over as a special administered region, which according to the agreement with the UK meant that it was only nominally to be under Chinese control for the next 50 years. It was possibly the only colony in which a vast majority of citizens did not...
  • Suffering the Profanity of Plentiful Cheap Money
      A Case of Highway Robbery What if the savings in your bank account lost 55 percent of its value over the last 12 months?  Would you be somewhat peeved?  Would you transfer some of your savings to another currency?   USD-ARS, weekly. For several years the Argentine Peso has followed a certain pattern: it declines mildly, but steadily, with little volatility for long time periods, and then spikes in crash waves whenever a crisis situation comes to a head. In early 2011, it...
  • Don’t Be Another Wall Street Chump
      The Future and the Past Securities and Exchange Commission Rule 156 requires financial institutions to advise investors to not be idiots. Hence, the disclosure pages of nearly every financial instrument in the U.S. are embedded with the following admission or variant thereof:   “Past Performance Is Not Indicative of Future Results”   “Buy and hold”... “The market goes always up”... “No-one can time the market”... “Buy the dip” “With what? You...
  • A Wild Week - Precious Metals Supply and Demand
      Paying a Premium for a Lack of Default Risk The price action got pretty intense last week! The prices of the metals were up Monday, Tuesday, and Wednesday. But Thursday and Friday, there was a sharp reversal and the silver price ended the week below its close of the previous week.   The net speculative position in gold futures has become very large recently – the market was more than ripe for a shake-out. [PT]   Silver made a round trip down from $18.35 to...
  • Will the Nikkei Win the Next Olympic Games?
      Listless Nikkei On 24 July 2020 the Olympic Summer Games will begin in Tokyo, the capital of Japan. Olympic Games and Soccer World Cups are among the largest sporting events in the world.  Do you perhaps also think that these events may affect the performance of local stock markets?   Olympic Summer Games 2020 – official logo (left), and a fan-made logo (right) by designer Daren Newman [PT]   Let us examine whether and in what way such major sporting events impact...
  • The Weird Obsessions of Central Bankers, Part 3
      Inflation and “Price Stability” We still remember when sometime in the mid 1980s, the German Bundesbank proudly pointed to the fact that Germany's y/y consumer price inflation rate had declined to zero. It was considered a “mission accomplished” moment. No-one mentioned that economic nirvana would remain out of sight unless price inflation was pushed to 2% per year.   CPI, annual rate of change. During the “stagflation” period of the 1970s, Congress enacted the...
  • The Weird Obsessions of Central Bankers, Part 2
      The Negative Interest Rates Abomination Our readers are probably aware that assorted central bankers and the economic advisors orbiting them occasionally mention the “natural interest rate” (a.k.a. “originary interest rate”) in speeches and papers. It is generally assumed that it has declined, which is to say, time preferences are assumed to have decreased.   This is actually an understatement...   Although interest is generally associated with money, the...
  • The Weird Obsessions of Central Bankers, Part 1
      How to Hang on to Greenland Jim Bianco, head of the eponymous research firm, handily won the internet last Thursday with the following tweet:     Jim Bianco has an excellent idea as to how Denmark might after all be able to hang on to Greenland, a territory coveted by His Eminence, POTUS GEESG Donald Trump (GEESG= God Emperor & Exceedingly Stable Genius). Evidently the mad Danes running the central bank of this Northern European socialist paradise were...
  • Why Are People Now Selling Their Silver? Precious Metals Supply and Demand
      Big Moves in Silver Last week, the prices of the metals fell further, with gold -$18 and silver -$0.73. On May 28, the price of silver hit its nadir, of $14.30. From the last three days of May through Sep 4, the price rose to $19.65. This was a gain of $5.35, or +37%. Congratulations to everyone who bought silver on May 28 and who sold it on September 4.   The recent move in silver [PT]   To those who believe gold and silver are money (as we do) the rising price...

Support Acting Man

Austrian Theory and Investment


The Review Insider


Dog Blow

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

Realtime Charts


Gold in USD:

[Most Recent Quotes from]



Gold in EUR:

[Most Recent Quotes from]



Silver in USD:

[Most Recent Quotes from]



Platinum in USD:

[Most Recent Quotes from]



USD - Index:

[Most Recent USD from]


Mish Talk

Buy Silver Now!
Buy Gold Now!