Election Years And The Stock Market

So always focus first on the economy and corporate earnings.

Election years and the stock market. From 1952 through june 2020 annualized real stock market returns under democrats have been 10 6 compared with 4 8 for republicans. Market performance in election years the good news for investors is that historically the market has performed well in election years with the s p 500 ending up in positive territory 82 of the time. History suggests that us stock market returns are correlated with the presidential election cycle.

In the lead up to the 2020 election he consistently claimed that if he were to lose stocks. The analysts saw that on average both stock equity and bond markets showed more muted performance in the year leading up to a presidential election than they did at other times. Since 1952 the dow jones industrial average has climbed 10 1 on average during election years when a sitting president has run for reelection according to the stock trader s almanac which is.

Although the stock market is not the economy historically both have played major roles in the outcome of presidential elections. Here are three key takeaways that can be drawn from the market s past performance during election years. The stock market and elections a review of market data for the s p 500 going back to the 1930s revealed that certain patterns emerged over those 90 years.

The s p 500 has made gains in 78 of election years since world war ii. According to dan clifton of strategas research partners history. 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.

According to the 2019 dimensional funds report the market has been positive overall in 19 of the last 23 election years from 1928 2016 only showing negative returns four times. It is a normal trend for the stock market to rise during an election year. But there are some clear exceptions.

President trump is now seeking a second term and the s p has gained an average of 6 6. For years trump has taken credit for the stock market s performance at least when it s up.