Regardless of which candidate emerges victorious, historically, investors have generally come out on top in the months following a presidential election.
The reason: Between Election Day and Inauguration Day, stocks generated positive returns 80% of the time, going back to 1984. The only two instances in which stock prices fell following the past ten elections occurred when the economy was experiencing extreme stress—in 2000, when the tech bubble burst, and in 2008, during the global financial crisis.
Remove those two recessionary periods, and we see that stocks were up 100% of the time from election to inauguration—positing a strong average return of 5.9% (see the chart).
The upshot: If you’re unhappy with the election results, don’t let that disappointment cause you to make rash moves with your portfolio.
By Mike Dickson, Ph.D.
Originally published Nov. 5, 2024
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