SPORTS AND MARKETS do mix, if you look around the trading rooms and halls of financial institutions. In fact, some say market activity slows as investors switch to another scene where betting, hedging, forecasting, opinions and results are as varied and heart-stopping as the options markets. That’s the FIFA World Cup.

UBS Wealth Management Research in fact has released their ‘calls’ on the coming event in South Africa, which kicks off June 11 with the host’s bafana bafana team versus Mexico. UBS’ analysts claim they’ve successfully predicted the earlier World Cup winners before.

For 2010, they forecast it would be — Brazil.

“Our forecast is based on in-depth quantitative analysis that places great emphasis on a country’s previous performance at World Cup tournaments. Only seven countries have ever won the World Cup (18 tournaments held to date). And even more surprisingly, just six countries have been represented in the last ten finals,” says UBS, with a confidence as high as the next armchair coach.

“Germany and defending champions Italy, as multiple world champions, are the two teams alongside record-holders Brazil that are most likely to win the tournament. The importance of past performance is also the reason why the WMR model suggests that Spain, who are tipped by many experts to finally lift the winner's trophy, could exit the competition before the semi-final stage.”

“The host nation will also find life very difficult, with South Africa’s campaign likely to hit the buffers in the round of the last 16,” says the model’s creator, UBS Chief Economist Andreas Hofert.

Of course, past predictions are no guide to future performance, UBS did admit. “Successful predictions owe at least as much to luck as to expert knowledge. Four years ago, Hofert not only correctly picked Italy as world champions, he also predicted six of the eight quarter-finalists. By contrast, the European Championships two years ago did not pan-out according to his predictions.”

But the UBS report may be right about one other aspect: that the World Cup will shine on Africa’s economic potential and rising stature, given the importance of its mineral resources, the growth success of several southern cape economies, and huge investments from China. Over one year, the South African Rand is up 10% against the US Dollar, driven by commodity price recovery in an economy where platinum and gold accounts for as much as 22% of South Africa’s exports.