Stock Market Indicator

The past couple of years in my NFL magazine I have produced an article called Slipping and Sliding. That article details how NFL teams do after a marked 1-year difference in their wins and losses from the previous year. My research shows that in the NFL from 2002-'10 there were 76 teams that improved their record by 3 wins or more from the previous season. Of those 76 teams only 11 had a better record, 8 were the same and 57 had a weaker record meaning that a team did not improve or had a weaker record 86% of the time. The biggest improvements prior to 2007 were made by the 2004 Pittsburgh Steelers, who improved by 9 net wins (6-10 to 15-1), and the 2004 SD Chargers, who improved by 8 net wins (4-12 to 12-4). In the season after their big improvement, the Steelers slid by 4 net wins (15-1 to 11-5) and SD by 3 net wins (12-4 to 9-7). Four years ago we had the largest improvement yet as Miami was coming of a 1-15 season. After being +10 net wins (11-5 in 2008) they fell back to 7-9 in 2009 finishing -4 net wins. Tampa Bay was +7 wins in 2010 (10-6) and was #1 on the list last year and as expected dropped to 4-12 (-6 wins).

Generally these charts are a two-way street and it has been just as good of an indicator going in the opposite direction. As I did with the net wins I took the teams that had 3 or more net losses from the previous year and found that the numbers weren't quite as strong. By tweaking the chart to use teams that had 4 or more net losses from the previous season I got the results I wanted.

Since 2002 there have been 64 teams that have had 4 or more net losses from the previous year and 47 (73%) have had a better record. Of the teams that had 6 net losses an amazing 21 out of 23 (91%) improved their record. LY's results saw 5 of the 8 teams improve their record. Cincinnati and Carolina were on top of the chart with +6 losses and the Panthers went 6-10 LY which was +4 wins while the Bengals were +5 wins and made the playoffs at 9-7!

When I tried to plug this system in for college football, it did not have the same results as in college ball, teams’ records fluctuate more and there is not as much parity. The college system I devised 5 years ago was built on a longer term. What I did was took a 2-year result record vs the previous year’s win total and it got me to the NFL-type percentages.

For example, last year Cincinnati was tied at #1 on my Stock Market Indicator (+7.5). In 2008 and 2009 Cincinnati combined for a 23-4 record, or 11.5 wins per season. In 2010 they had just 4 wins. Therefore, they were +7.5 in my Stock Market Indicator meaning the prior year’s record was far below normal standards. As expected, Cincinnati improved their record to 10-3. The other team last year at +7.5 was Texas. Texas was my #3 Most Improved Team in the country and improved significantly. The Longhorns made this list by going 25-2 in 2008 and 2009 or an average of 12.5 wins then winning just 5 games in 2010. They had a +7.5 Stock Market Indicator and as expected, moved up to 8-5. Last year there were 29 teams that had a +2.5 Stock Market Indicator or more and of those 29 teams, 21 improved their record, just five had a weaker record and three remained the same. That 24 out of 29 success rate translated into 82.8% last year!

I had only been doing the totals over the last couple of years but this year developed a formula to help me go back to 1990 and check the results. I was quite surprised. Since 1990 there have been a total of 17 teams that had a +6 Stock Market Indicator meaning that the prior year’s win total was 6 wins less than the average of the 2 years prior. Of those 17 teams, 16 improved their record while one stayed the same and it was dramatic going from a combined 51-144 (26.2%) to a combined 94-107 (46.8%). I had expected to see a drastic drop off in the numbers at the next few levels but surprisingly did not. Teams in the +5.5 category improved their record to a 10-2-2 clip. There were 29 instances of teams being +5 in the Stock Market Indicator category since 1990 and those teams were an amazing 22-6-1 (79%). The totals did drop to 75% for +4.5 with it going 27-10-3 and when the total got to the +4 Stock Market Indicator, it surprisingly went back up to 37-8-4 (83.7%) which was superior to the individual +4.5 range. The numbers did drop to 76% for a +3.5 net wins, 77% for +3 and down to 69% for +2.5. Just when you thought the trend would get lower, surprisingly +2.0 had a 75.5% success rate. Even teams that had a +1.5 Stock Market Indicator from the prior two years, went up 64% of the time.

Summing it all up, I will put it into 3 categories. Teams with a +6.0 Stock Market Indicator or higher were a perfect 16-0-1 (100%). Teams in the +4 to +5.5 range were 96-26-10 (80.3%). Teams in the +1.5 to +3.5 two-year Stock Market Indicator range were 289-133-42 (71.3%). The team that had a +1.5 Stock Market Indicator or higher had 401 improved their record, 159 have a weaker record and 53 have the same record meaning 74.1% of the time, teams in that category improved or had the same record.

This year there is just one team that falls into the 100% bracket of +6 on the two-year Stock Market Indicator. Middle Tennessee had a record of 16-10 in 2009 and 2010 for an average of 8 wins per season and last year had just 2. At the +5.5 total is Ohio St who avg’d 11.5 wins in ’09-’10 but had just 6 last year and also Troy who avg’d 8.5 wins in ’09-’10 but had just 3 last year. Below is a list of all teams that are calling for a Bull Market this year including nine teams with a +4 Stock Market Indicator or more meaning they have an 83% chance of maintaining or improving their record this year.

2012’s Bull Market Teams

Like all of my charts I put in my magazine, there is a two-way street to this Stock Market Indicator. When I reviewed the numbers since 1990, it was surprising that team’s with a -4.5 Stock Market Indicator or lower, which was a much greater sampling than the -7 or lower actually achieved a better percentage. While two teams managed to improve their record at the very top of the chart, none did in -6.5 or -6.0. In fact of teams that had a -6.0 Stock Market Indicator or lower, only 2 managed to improve their record. In 2003 Navy which went from 8-5 to 10-2 and 2000 South Carolina which went from 8-4 to 9-3. The biggest drop offs were 1998 Tulane which had a -7.5 Stock Market Indicator and went from 12-0 to 3-8. Interestingly in 1998 I called for Washington St to go from a Rose Bowl to last place in the Pac-10 - which they did and in the 2 year Stock Market Indicator they were -6.0 and went from 10-2 to 3-8. Others that achieved large drop offs were 2008 Ball St which went from 12-2 to 2-10 with a -6 Stock Market Indicator and 1996 Army which went from 10-2 to 4-7 with a -5.5 Stock Market Indicator. Last year Miami, Oh topped this list with a -8.5 Stock Market indicator and plummeted from 10-4 in 2010 with a MAC Championship to just 4-8 last year. In fact last year all six teams with a -5 indicator or lower ended up with weaker records last year!

A look at the 2-year Stock Market Indicator shows a power trend of basically 80% if teams have a -2.0 Stock Market Indicator or less since 1990. Unlike the above positive Market Indicator, there were actually two teams that bucked the trend with a -7.5 or -7 and improved but overall the chart has higher percentages. Teams that had a Stock Market Indicator of -5 or lower had a weaker or the same record the next year 90.6% of the time with 73 having a weaker record, only 8 managing to improve and 4 having the same record. Even teams with a Stock Market Indicator of -3.0 to -4.5 were in an 80% category having a weaker record 162 times and improving the record just 45 and the same record 19 times. Unlike the positive Market Indicator, I was not pleased with the results of -1.5 so the chart really should be cut off at 2.0. The teams in the -2.0 to -2.5 Stock Market Indicator had a weaker or same record the next year 73.0% of the time.

Bottom line is that a 90.6% trend of a weaker or same record if teams have a -5 indicator or less, -3 to -4.5 is 80% and -2 to -2.5 73%. Overall, teams that had -2 Stock Market Indicator or lower had the weaker or the same record basically 80% of the time.

The teams this year that have trends going in a downward Bear direction at the top of that chart in the 90% category are WKU, which was 2-22 the prior 2 years for an average of 1 wins per season and improved to 7-5 last year giving them a Stock Market Indicator of -6. Arkansas St had a record of 8-16 the previous 2 years or an average of 4 wins per seasons and improved to 10 last year (-6 Stock Market Indicator). Houston had a record of 15-11 or an average of 7.5 wins per season and improved to 13-1 last year for a -5.5 Stock Market Indicator. Eastern Michigan and Michigan both checked in a -5.

Here is a complete listing of all of this year’s teams with a Bear Market in their forecast:

2012’s Bear Market Teams

ONLY 86 DAYS LEFT UNTIL THE FIRST COLLEGE FOOTBALL GAME!!!