LeBron James And The Stock Market

Discussion in 'Stock Market Forum' started by ParmMannTrader, Aug 9, 2014.

  1. ParmMannTrader

    ParmMannTrader Active Member

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    Back in 2003, as the US economy was coming out of a recession, the markets were slowly trying to get up off the mat. The tech wreck of 1999-2000 had sent the markets into a tail spin and all the major indexes suffered substantial losses; including America's sweetheart index the Dow, represented here by the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA). So, while most people were looking at improving economic data and low interest rates as the reason for the turnaround, I was looking at the emergence of LeBron James.

    Many of you are probably scratching your head and thinking, what is this guy talking about. Well hear me out, as some of the facts are quite interesting. On June 26, 2003, "King James" was drafted by the Cleveland Cavaliers. That day the Dow had a closing print of 9079.04. Over the next few years as James started to hit his stride in the NBA, the markets moved up higher right alongside the basketball phenom. In the 2006-07, LeBron James was playing the best basketball of his career to that point, and lead his Cavs to the final. They eventually lost out to the San Antonio Spurs in four straight games. Then a few months later on October 11, 2007, the markets topped out with the Dow closing at 14015.12. Over the next few years James would continue playing for his hometown Cleveland Cavaliers, but would not reach the finals again, and the markets would not reach those lofty levels during that same period.

    In the summer 2010 King James was a free agent and speculation swirled around what team he would choose and on July 8, the much anticipated "DECISION" was announced. The basketball star was taking his 'talents to south beach' to play for the Miami Heat. That day the Dow had a closing price of 10138.99. So from the time LeBron was drafted, to the time he switched teams, the markets had gone up just over 11%, which is a bit uninspiring considering it was over 7 years.

    So how did the bulls of SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) feel after the superstar switched teams? Since the day of the historic move to Miami, you could say the markets really began to "HEAT" up. The Dow has blown past the previous high water mark of 14198.10 and gained nearly 70%, and seems to be hitting new record highs on a daily basis. After seeing this interesting correlation between LeBron James and the stock markets, one has to say that it won't be just the basketball world who is awaiting the free agent's decision. While it might be far fetched to say that LeBron has any effect on the markets, it is none the less interesting to note the timing in certain events.

    Would you place your market wagers on the direction of Lebrons career? Comment and let me know your thoughts. Either way, as smart traders and investors we know there is always a great trade waiting for us; all we need to do is keep the odds in our favor.



    Parm Mann
    Elite Round Table
    Follow me on twitter: @ParmMannTrader
     
    Last edited by a moderator: Jul 8, 2016
  2. dianethare

    dianethare Senior Investor

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    That is what i call using tact and wit, correlating a basketball player with the Dow Jones, who knew?...smart move i say :)
     
  3. BabyBear

    BabyBear Active Member

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    As the saying goes, "Correlation does not equal causation." :p I can only assume this article was meant in jest. Obviously, there's no reason to think the movements of the markets have anything to do with Lebron James or any other NBA player.
     
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  4. ParmMannTrader

    ParmMannTrader Active Member

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    Yes this article was meant as just an interesting correlation and in no way do I actually think that Lebron James is the reason why markets move...but will be interesting to see how markets behave now that he is back in Cleveland.
     
  5. wulfman

    wulfman Guest

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    I suppose he has some impact on the market. Very little but some. I know James is good friends with Warren Buffett. Both ate at a McDs and talked about how to invest money properly.
     
  6. troutski

    troutski Guest

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    I dunno, most of the country does love Lebron James, whether they love to cheer for him or hate on him. If I would have to choose one athlete's moves that affect the stock market, then I might possibly believe that his transactions with teams could affect stocks. I'm joking of course, but the "data" cannot lie. He's going to have to call it quits sooner or later when he starts aging, so I'll get ready to buy stocks after the entire market crashes the day he retires. ;]
     
  7. Profit5500

    Profit5500 Senior Investor

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    That is very interesting I did get that feeling with your post. I feel like Lebron James did have an effect on the stock market. It is like the more he played the more the Dow increased.
     
    Last edited by a moderator: Jul 8, 2016
  8. jondjacob

    jondjacob Well-Known Member

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    Exactly. Lebron is an interesting player, but very little to do with the stock market at all...that said, the stock market is not necessarily immune to any outside cause, even a basketball player.
     
  9. askanison

    askanison Guest

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    I have never heard of any system that correlates a sport or sports figure with the stock market. Sounds crazy lol. I imagine you can match up many different things this way though. I wouldn't put much "stock" in it though. Sounds a bit like an article The Onion would put out.
     
  10. JR Ewing

    JR Ewing Super Moderator Staff Member

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    LeBron's career moves won't impact my investing whatsoever. :D

    I am curious as to how much of his fortune he actually invests, whether he took Buffett's advice, if he's wise enough to use a professional, etc.

    I would not be shocked if he never actually acted on Buffett's advice and instead chose to piss his money away or otherwise invest it in unwise ways.
     

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