Samwise Model Portfolios
The portfolios below are separated by launch dates. Each portfolio is entirely independent and has no bearing on any other model portfolio. We launch entirely new portfolios during each market correction as an illustrative tool for new subscribers who weren't present during...
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Don’t you think that the election results will immediately relief the uncertainty, hence immediately push the markets bullish (whichever the winner) ?
Only if there is a clear winner the day after the election – my guess
Yes, if there is uncertainty about the results after Tuesday evening, Wednesday at the latest, markets would react badly. There’s nothing the markets hate more than uncertainty. I saw a headline that say this election is expected to be the most litigated election ever.
All good points across the board. The way I’d view the election is as such.
(1) the immediate impact after the election itself will be short-lived. Even if it’s highly contested, highly litigated and with no clear-cut winner, it’ll still be short-lived. The market will have an initial knee jerk reaction, and then it will move on to other issues.
(2) the longer term impact will largely depend on the substance of contention and whether there is any visibility as to the outcome. If one party or the other blows hot air or otherwise raises issues the market believes will clearly resolve in one direction or the other, then the market will move on. We need true contention for there to be any lasting impact.
For example, the Bush v. Gore election was truly contested and left genuine uncertainty with the stock market. I don’t think we’ve had that level of uncertainty since then. There certainly has been contention, but I think from the stock market’s point of view, I don’t think the market has been left wondering about the ultimate outcome/end result after each subsequent election since Bush v. Gore.
(3) The general bias after Presidential Elections has been positive, As you can see from the article I published on the matter, the market tends to trend higher after an election. I don’t think it’ll be much different here. Once the dust settles, we’re likely to see higher markets over the next 6-months.