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What’s Happened To The Stock Market After Every Midterm Election Since World War II

FYI: Tuesday is going to be a crucial day for the stock market. Are you prepared?

If the polls are correct, President Donald Trump and the Republicans are in big trouble. There’s an 86% chance Democrats will seize control of the House of Representatives, according to statistical-analysis firm FiveThirtyEight.

This is causing big-time anxiety for investors who’ve enjoyed the 28% stock market rally since Trump took office. No matter what you think of Trump, his reign as president has been great for stocks. But as the election has drawn closer, the market has fallen apart.

The S&P 500 closed out October with a 7% monthly drop, nearly its worst month since the financial crisis. So what could happen this month—and the months ahead?

Few topics stir emotion in America like politics. Many perfectly reasonable people lose the ability to think straight when they hear the name “Trump.” As I always said at RiskHedge, politics and investing don’t mix. Investor Warren Buffett often says: “If you mix politics and investing, you’re making a big mistake.”


  • edited November 2018
    “For all the market’s gyrations in the past few weeks, the S&P 500 is roughly flat this year. If we stay on script, we should expect the market to surge in November after the uncertainty of the elections is behind us.”
    See this from Capital also =>>
    “U.S. politics will be a key focus of uncertainty for investors until November, when the results of important midterm elections should provide some answers. Both houses of Congress are in play and the parties are pulling out all the stops to turn out their voters. The election results could have significant short-term ramifications for investors.”

    This one also=>>

  • edited November 2018
    "Since 1946, there have been 18 midterm elections. Stocks were higher 12 months after every single one. Every single one. That’s 18 for 18."

    Duh? That probably simply means that the approach of an election brings about uncertainty (pretty much the definition of election). Markets don't like uncertainty. I don't like uncertainty.

    18 out of 18? I'd prefer at least 25/25 before I'd bet the ranch.
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