Cricket and the capital market: Winning does not matter but losing hurts

There is increasing evidence of the inadequacy of ‘rational’ explanations of asset pricing. It has been established empirically that mood, induced by such natural phenomena as lunar phases or sunshine, affects asset prices. This paper provides evidence from one‐day cricket international (ODI) matches played by India that there is a significant negative impact on the daily stock market returns when the national team loses. Empirically, losing in India matters somewhat more than losing outside. The mood induced by losing a match appears conditioned by history, in that losing to nations that represent the ‘colonizers’ matters but losing to nations that share India's experience of being ‘colonized’ does not.