The paper also notes next-day equity market losses following a World Cup loss are worse for a country’s small-caps. That means it investors in the Market Vectors Brazil Small-Cap ETF (NYSEArca: BRF) could feel a one-day pinch if Brazil happens to lose a match. [Brazil ETFs Finally Attract Cash]
As for the advantage of being the host nation, six previous host nations have won the World Cup with France being the most recent in 1998.
Fortunately, the iShares MSCI France ETF (NYSEArca: EWQ) debuted in 1996, so investors have the ability to measure the performance of some of the largest French stocks following the 1998 World Cup victory. They probably will not like the results. France won the World Cup on July 12, 1998. From July 13 to Dec. 31, 1998, EWQ lost 2.5%.
Spain, the defending World Cup champion, honored the theory of equity market gains following its 2010 title. On July 12, 2010, a day after Spain won the title, the iShares MSCI Spain Capped ETF (NYSEArca: EWP) closed at $36.91. By Aug. 3, 2010, EWP had gained 12.7%.
iShares MSCI Brazil Capped ETF
