Can the Return of the McRib Really Boost Stock Market Performance?

Can the Return of the McRib Really Boost Stock Market Performance?

Key Points

The McRib’s limited-time return to McDonald’s (MCD) menus has historically coincided with strong stock performance.

Nick Maggiulli, COO of Ritholtz Wealth Management, found that the S&P 500 tends to post higher average daily returns when the McRib is available.

The so-called "McRib Effect" serves as a reminder that correlation does not imply causation, as the sandwich’s return typically aligns with a favorable time of year for stocks.

The McRib Returns

McDonald’s announced that its iconic McRib sandwich would make its highly anticipated return for a limited run starting Tuesday. Known for its scarcity, the McRib often drives sales for the fast food giant. Interestingly, its reintroduction has also coincided with historically strong stock market performance, leading to what some now call the "McRib Effect."

The phenomenon raises the question: can a fast-food pork sandwich really hold a place among stock market patterns like the "Santa Claus Rally" or "Sell in May and Go Away?"

What Is the McRib Effect?

Between 2010 and 2023, the S&P 500 averaged a daily return of 0.1% when the McRib was available, compared to 0.04% on days it wasn’t, according to Maggiulli.

Maggiulli first highlighted the McRib Effect in 2018, noting that the S&P 500 outperformed by an average of 7 basis points (0.07%) during the sandwich’s availability from 2010 to 2017. On an annualized basis, this would imply a 19% outperformance.

Over time, the outperformance has varied, dropping to 5 basis points in 2020 and settling at 6 basis points in 2022. Interestingly, some have drawn parallels between the McRib Effect and bitcoin’s performance. For example, last November, bitcoin’s price rose as the McRib returned and markets buzzed over the potential approval of spot Bitcoin ETFs.

The Limits of the McRib Effect

Maggiulli has emphasized that the McRib Effect is a playful illustration of the principle that correlation does not equal causation. The stock market’s movements are driven by complex, simultaneous decisions made by millions of investors—not by the return of a fast-food sandwich.

Additionally, the McRib is typically reintroduced toward the end of the year, a period that has historically been favorable for stocks due to seasonal factors like the holiday shopping season and the "Santa Claus Rally."

Investors should approach the McRib Effect with humor rather than seriousness. Stocks are inherently risky, and evaluating a wide range of factors is essential for making informed investment decisions—whether buying individual stocks or funds that track indexes like the S&P 500.

Conclusion

While the return of the McRib might add excitement to McDonald’s sales and spark playful discussions in the financial world, it’s a reminder to view such correlations as coincidence rather than actionable investment strategy. That said, if you’re a fan of the sandwich, its comeback is reason enough to celebrate—even if it doesn’t actually boost your portfolio.