Election Year And Stock Market

If you are worried about the uncertainty elections present and the fact that 2020 may be a presidential election year when we can t declare a winner on election night resist the temptation to sell.

Election year and stock market. The first 2 years of a presidential term have been associated with below average returns while the last 2 years have been well above average. Of these 14 recessions only five have occurred during a general election year. This ushered in the great depression.

So always focus first on the economy and corporate earnings. Since 1929 the united states has had 14 recessions. The four year presidential market cycle is well known on wall street.

S p 500 annual stock market returns during election years year return candidates 1928. They will scour past data and events to find a correlation between it and any trends in the market. But there are some clear exceptions.

History suggests that the correlations between an election year and the stock market follow strong predictable patterns. Election year stock market returns here are the market results for the s p 500 for every election year since 1928. One question that always seems to come up in investing circles every four years is the relationship between an election year and the stock market.

Although the stock market is not the economy historically both have played major roles in the outcome of presidential elections. The stock market during election years if there s one thing the stock market doesn t like aside from bad earnings it s uncertainty. Data below is from dimensional s matrix book 2019.

History suggests that us stock market returns are correlated with the presidential election cycle. According to dan clifton of strategas research partners history. As america ramps up for a contentious election day there s a good chance we won t know who wins until days or even weeks after november 3.