Sports Illustrated Swimsuit Issue Indicator

The Sports Illustrated Swimsuit Issue Indicator is an economic indicator which correlates the performance of the S&P 500 in a given year with the nationality of the model who appears on the cover of that year’s Sports Illustrated Swimsuit issue. 

The Sports Illustrated Swimsuit Issue Indicator is an economic indicator which holds that the U.S. stock market performs better in years when the model on the cover of the Sports Illustrated Swimsuit issue is American. The indicator suggests that when the cover model is from the U.S., the S&P 500 will generate a return above its historical rate, while a non-American cover model leads to underperformance by the S&P 500 for the year.

Bespoke Investment Group initially proposed a correlation between the performance of the S&P 500 and the nationality of the Sports Illustrated Swimsuit Issue cover model.

Tracking data from 1978, analysts have noted that overall returns on the S&P 500 are better in years with cover models who are American, while non-American models tend to indicate less spectacular returns. Between 1978 and 2012, Sports Illustrated featured 19 American models and in those years, the overall S&P 500 average return was a 14.3 percent gain, with positive returns 88.2 percent of the time. The 17 years in which non-American models were featured saw an average S&P 500 gain of 10.8 percent, with positive returns 76.5 percent of the time. A frequently-cited example is 1997, the year American model Tyra Banks graced the Sports Illustrated cover, and the S&P 500 was up 34.1 percent.

As with many popular culture based indicators, this is not a precise measure. In fact, in 2008, when Sports Illustrated featured American model Marissa Miller on its cover, the S&P 500 plummeted, significantly skewing the averages for this indicator.

While the Sports Illustrated Swimsuit issue has been an annual publication since the 1950’s, the nationalities of the cover models were not always made available until 1978.

Just one of many indicators rooted in popular culture phenomena, the Sports Illustrated Swimsuit Issue Indicator stands alongside a host of other indicators posed by analysts and investors since the beginning of the stock market. These indicators describe market tendencies and possess limited accuracy, but they remain intriguing ways to look at the ways culture and markets interact.

Some other indicators include:

The Super Bowl Indicator, which suggests that the stock market will decline when a team from the American Football Conference wins the Super Bowl, and that an upswing will occur when the National Football Conference team wins. Introduced in 1978 by sportswriter Leonard Koppett, this indicator boasts only an 80% accuracy and, as with the Sports Illustrated Swimsuit Issue indicator, failed to accurately predict the 2008 downturn.

The Hemline Indicator, which proposes that skirt hemlines are higher when the economy is performing better, such as the high hemlines of 1990’s when the tech bubble was forming. This indicator was first posed in 1925 by George Taylor of the Wharton School of Business.

The Men’s Underwear Indicator, a favorite of former Fed Chair Alan Greenspan, which suggests that declines in the sales of men’s underwear indicate a poor overall state of the economy, while an upswing in underwear sales predicts an improving economy.