The Stock Market Doesn't Care About Political Parties - REMIX | Series 10.5

Enjoy More 30s: Family Finance

Dec 5 2022 • 7 mins

Overall, what the market tends to be influenced by is certainty vs uncertainty.

  • Studies have been done on the president, the House, the Senate, combining all three of these in different ways to see which one of those has been the most favorable to the stock market in past history. And what they found after what I'm sure was a lot of work is that there is no strong correlation for any particular combination over the long term. (03:19)
  • One strong positive indicator, however, is the midterm elections themselves. So not who wins the elections, but the elections themselves. (03:56)
  • Going back even further to 1950, if we look at every 12 month period, immediately following the midterm election date, it has been positive. Every single one going back to 1950 with an average of 15.1%. (04:23)

Quote for the episode: "Overall, what the stock market tends to be influenced by more than anything is certainty versus uncertainty." (05:01)

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