(News Bulletin 247) – The stock symbol is sometimes used humorously by listed companies. And those companies with fun “tickers” tend to outperform the market, studies show.

It is a very quick way to identify a financial security, in the space of just a few letters: its symbol, or “ticker symbol” or “ticker” by metonymy, or even mnemonic code in good French. For example, in Paris, Capgemini has the symbol “CAP”, Airbus “AIR” and Hermes “RMS”

The introduction of these codes dates back to the 19th century at a time when electronic exchanges were a fiction. Edward Augustin Calahan created in 1867 a teleprinter, a strip of paper connected to the telegraph, called a “stock ticker”. He then decided to designate each title by a limited number of characters (one to four), so as not to have to type the full name of a company, and thus transmit the prices to investors as quickly as possible.

This explains why the old heavyweights of Wall Street now have a “ticker” limited to a single letter, this is the case for example of Citigroup, designated with a simple “C”.

Obviously, technological advances have gradually limited the time savings induced by these “tickers”. But market operators can still use them to exchange with their interlocutors, or to launch a search on Bloomberg (or on social networks). While most tickers are very prosaic, like “AAPL” for “Apple”, others are much more fun. Here is a small list.

Lots of “LUV” at Southwest Airlines

“FUN” (“funny” in English) is the ticker of the Cedar Fair Entertainment Company, which owns a dozen amusement parks and water parks in the United States and Canada. “Fun to us it’s serious busines” is their leitmotif.

In the same vein, “PLAY” (“play” in English) refers to the company Dave and Buster’s which combines fast food and arcades.

“LUV” is associated with Southwest Airlines. Note here that “luv” is the word “love”, in SMS language. According to ABC News, this refers to the fact that Southwest’s headquarters are based in the “Love Field” area of ​​Dallas. And that the company makes tons of them around the theme of love. “As our company and customers grew, our LUV grew too!” (“As our company and our customers have grown, so has our love,” says the airline, for example, in the “history” section of its site.

“BREED” (“racing” in English) is none other than the symbol of Ferrari, perhaps the most emblematic car manufacturer in motor racing and Formula 1. As a reminder, the group went public in 2015.

“HOG” for Harley-Davidson. The reference is a little more subtle. HOG refers to “Harley owners group”, that is to say a club created in the 80s by the company and which anyone who owns a motorcycle from the iconic two-wheeler brand can join. The shareholders of the company, listed since 1986, are therefore also members, in a way.

“BABY” refers to Else nutrition, a company specializing in nutrition for babies, infants and children.

“GEEK” was the ticker of the internet service provider called Internet America, which was floated on the stock exchange in 1998 and acquired by its competitor JAB Broadband in 2015.

tigers and cows

“GRR”another ticker from a group that is no longer listed, was associated with investment firm Asia Tigers Fund (hence the “grr”) which has since merged into Scottish asset manager abrdn.

Same sound logic for “WOOF”, the ticker associated with Petco Health and Wealthness company, a company specializing in the sale of food and articles for pets. The “woof” thus refers to a barking dog.

“COW” (“cow” in English) is a ticker associated with an ETF (an index fund) of the Toronto Stock Exchange, which invests in companies in the agricultural sector, such as manufacturers of fertilizers or packaged meat.

“TAN” (the tan in English) is linked to the ETF Invesco Solar, which, you guessed it, invests in companies active in solar energy, such as the French Neoen or the American First Solar.

“Yum” (“yum” in English) is related to Yum! Brands. Behind this name, we simply find KFC, Taco Bell or Pizza Hut.

“BOOM” is associated with DMC (Dynamic Material Corporation) Global, a metalworking and building materials company, originally called Explosive Fabricators.

“WINE” is the ticker of Gaucho Group Holdings, an e-commerce company, with several activities in fashion, real estate but also “refined wines”, she explains.

“PZZA” is associated with Papa John’s Pizza, an extremely important pizza chain in the United States but unknown in our latitudes.

“CAKE” (“cake” in English), the symbol of the American chain of restaurants and cafes The Cheesecake Factory.

“ZEUS”, the Greek god of lightning, and thus, also, the ticker of steelmaker Olympic Steel, which is not based in Greece but in Ohio. A company that therefore thinks it has come out of Jupiter’s thigh…

Long-term outperformance

In Paris, our rating members have less humor. We can just note the symbol “WOLF” of the LDC food group specializing in poultry, this symbol can be read as a contraction of “LOUé” and “Chicken”.

It should be noted that some studies have found that these values ​​with simple or funny tickers tend to outperform all the indices. This was demonstrated by researchers at the University of Pomona, California, in a study published in 2009. The academics then found that over a period from “1984” to “2005”, a basket of these stocks with a “smart” ticker generated an annual return of 23.5% per year on average, almost twice as much as the New York Stock Exchange and the Nasdaq.

Other academics from this same establishment conducted a study in 2019 to verify the findings of that of 2009. Again the results were convincing, showing a clear outperformance over the period from 2006 to 2018.

A possible explanation would simply come from the fact that these unusual tickers stand out from the crowd by attracting attention via their sound or their image, which makes it possible to arouse more investor interest.