Advisers don’t usually shy away from a healthy wager — as long as it's backed by detailed research, due diligence and a successful enough track record.
Allspring Global Investments, the former asset management division of Wells Fargo that was sold to private equity firms for $2.1 billion last year, has tried to predict the champions of the National Football League since 2003 by taking its quantitative analysis approach to investment strategies and refocusing it onto the gridiron.
The $482 billion money manager calculates how much bettors would have won if they wagered $100 on every team's games during the regular season. For the entire 17-game season, teams with season-long winnings above $1,700 have a positive alpha, while anything under equates to an overall loss on that position.
These scores are then used to help predict future performance and can even be used to find the best team to pick during Super Bowl LVI, said Matthew Robinson, portfolio manager with Allspring Systematic Equity.
“It’s more or less looking at teams in a similar way to how we look at investments and individual stocks,” Robinson said. “We look at how they perform relative to market expectations, except in this case, the expectations are the betting lines set by Vegas.”
The Cincinnati Bengals had the seventh-best alpha this year of 24.1%, while the Los Angeles Rams had a total alpha of 8.6%, according to the Allspring data. Since most over-performing teams revert back to the average, Robinson and his team are predicting the L.A. Rams will come out on top this Sunday.
“Since we expect higher-alpha teams to underperform, our pick for Super Bowl LVI is the Los Angeles Rams,” Robinson said.
If the Rams are to eventually cover the betting spread this weekend —which means the Rams will need to not only win the game, but win by four or more points — then the overall strategy will improve Allspring's record to 14 wins and 5 losses in Super Bowls all time, according to Robinson.
This postseason, the strategy has 8 wins with 4 losses against the spread.
“We’re not advocating taking out a second mortgage,” Robinson said, “but the hurdle you need to clear [to cover betting fees] is 55%, and getting 7% above that is pretty good.”
Super Bowl LVI marks the fourth time a team has played in its home stadium. Home teams have won two out of three of those games, including last year’s finale at Raymond James Stadium, featuring famed New England Patriots quarterback Tom Brady, who finished his career with Tampa Bay this season.
Which was the only team to lose the Super Bowl in its home stadium? Ironically, it was the L.A. Rams, which lost to the Pittsburgh Steelers at the Rose Bowl in Pasadena, California, during the 1980 season.
While teams with higher NFL alphas that outperform expectations in one season usually underperform the following year, there's one very notable outlier.
“We’ve had a lot of trouble with the Patriots,” Robinson said, adding that the quant is only accurate about 50% of the post-season games involving long-Brady. “The Patriots have been a real thorn in our side.”
While Robinson said he’s not a betting man himself, the NFL quant is a welcome distraction to the markets during Super Bowl week and something that grabs a lot of attention from clients ahead of the big game.
“It's always fun to see how the numbers play out,” he said.
From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.
"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.
Chair also praised the passage of stablecoin legislation this week.
Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.
A new PitchBook analysis unpacks sticking points relating to liquidity, costs, and litigation risk for would-be investors and plan sponsors.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
