If you watched the September 29th presidential debate, I'm sure you walked away with a mixture of disbelief, concern and astonishment regarding the level of conduct on display. I personally wanted to "scream" for President Trump and former Vice President Biden to stop with the insults. Because like all Americans, I'm
heading to the polls with varied emotions due to social unrest, an economic downturn occasioned by the COVID-19 pandemic, and a myriad of other issues. And as an investor, I'm sure you're wondering what you should be doing; so allow me to give you some information...
What Investors Need to Know About Politics and Market Performance
There is no denying that presidential elections affect an investor's regular life by impacting financial markets. A keen look at the past 75 years through Democratic and Republican administrations reveals that a superior market performance cannot be attributed to either of the political parties. Politics has some influence, but since political administrations by either party have seen economic expansion and good financial market performance, it is not entirely predicated upon the winner of a presidential election.
While political patterns between the presidential election's winners and the market's performance continue to be drawn, as an investor you should be more concerned about tightening the nuts in your investment goals irrespective of the outcome of the November polls.
How Investors Can Make Sound Investment Decisions Amid the Presidential Election's Uncertainty
What's next after the presidential elections? What does a win by either side portend for my investment? These are arguably the biggest questions rocking every investor's mind in the run-up to the presidential elections. With all the events taking shape as we edge closer to the presidential election, you might tend to feel apprehensive about making new investments.
Uncertainty ensuing from the result of the presidential election affects the financial markets; therefore, having access to the right investment knowledge and advice is vital. Enhance your investment understanding by accessing our spot-on investment resources to bridge any financial literacy gaps you might have during these anxious times for investors.
What History Can Teach Us About the Impact of US Presidential Elections On Markets
If history is something to go by, then S&P 500 Index data dating back from 1928 to 2012 shows that past elections have impacted stock market returns. Remarkably, more positive market performance than negative has been witnessed over the last 23 presidential elections, meaning that stocks tend to gain more often.
However, in certain years when there were extraordinary circumstances such as the nation being at the brink of war, a financial crisis, or a depression, market performance went down. With the COVID-19 storm still a very real prospect for the country, the implications of a win by either President Trump or former Vice President Biden remain to be seen. Consequently, if you want to feel more secure about your financial future, investing in the long-term could be a more unwavering endeavor.
To Invest or Not to Invest
Should I continue with my investment plans now, or should I defer? The answer to this question lies in the results of your investment. Studies show that partisan investors compare unfavorably to bipartisan investors. Additionally, the more time and investment you expend in the market, the bigger the bite you take out of the progressive financial performance apple. Over time, US markets have always withstood whatever result the presidential race throws at them, and thus as an investor, you are better off proceeding with a strategic investment strategy regardless of who wins the race to the White House.
If you are dealing with thoughts on whether to pull out completely or put your investment on hold, don't overthink it. The best thing you can do is to stay the course. Though the presidential election poses some short term volatility, staying the course and remaining upbeat about the investment decisions you've made thus far is the right choice. Drawing back on your investment journey could cost you tens of thousands and maybe even millions down the road, when investments will not be on shaky ground.
Bottom-Line
Remember that you will live with the investment choices you make today. Therefore, you should strive to strategically make excellent investment choices. At Brown Investors, we believe that now is always the time to make money, and we are committed to helping you get your investment decisions right. Every great company has to weather volatility at some point and that's why we are rallying and helping investors in the BI Community stay the course. Want to learn more? Check out and take advantage of our socially conscious investing offerings by getting in touch with us today .
Bridging the Gap!
Brown Investors