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Workers pass the bull in New York’s Financial District.

David Karp/AP

Magazine covers aren't what they used to be. They once carried some weight among contrarian investors looking for evidence that the stock market was either primed for a rally (thanks to a bearish cover) or a correction (a bullish cover). Now? Covers aren't providing a clear signal.

That's the conclusion from Birinyi Associates after they looked at issues of Time magazine with pictures of bulls on the cover. They found nine of them – not including the most recent cover story (and picture), "How Wall Street Won."

While you might suspect that the Dow Jones industrial average would decline in the year following the cover – according to the contrarian line of thinking here – the opposite is closer to the truth: The blue-chip index rose in six of the 9 examples, and the average return was 12.8 per cent. In other words, Time had it right most of the time.

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Of course, Birinyi was looking at just one magazine in its sample. When contrarians point out some notorious examples, they take a broader view. The 1979 cover of Businessweek, "The Death of Equities," marked a good time to get in to stocks. Similar contrarian cases have been noted in Forbes and even The Economist.

Still, it is worth noting that just as magazine cover stories are fallible, so too are the contarian patterns upon which they are based.

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