Markets and Elections
Written by Lee Stoerzinger, CFP®
You may not have noticed, but I wanted to mention that we will be having a Presidential election in the fall of this year. With this and all the other things going on in our world, we have been receiving many questions about how this will affect markets, the economy, investments, etc.
While we understand and appreciate the concerns, we thought it would be good to share some historical perspective. This article from Fidelity, dated January 2020, does a nice job using data points - going all the way back to 1789 - to provide historical context surrounding elections, political parties, and the resulting effects on the markets. I encourage you to read this article from Fidelity to help you in your analysis of this highly complex subject.
I have one more comment regarding this topic. In addition to receiving questions about the election, we've also received many specific questions about “getting out” of the markets for the rest of the year to see what happens, with the idea of "getting back in" after everything is settled. While we also understand these feelings, we have found that changing personal long-term life goals around one historical point can often prove challenging. Among other things, it is often quite difficult to determine when to "get back in." The most recent example of this was earlier this year. We had a large market decline in March and April, and a very quick recovery that many people found confusing.
We would much rather build plans and portfolios that weather all storms over time for we believe it is time, not timing, that proves to be the real ingredient in investment success.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.