SPY on the Market: How Presidential Elections Affect the Stock Market | | by Hugh Grossman and Ahren Stephens
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Click here to join me. | | | With only several weeks away from the Nov. 5 election, the presidential race is as heated as ever.
The polls show a very close race, especially in the battleground states where neither camp has any significant lead. Over 67 million people watched the latest Trump-Harris debate, which appeared rife with lies, name-calling and moderator bias. Personally, I was waiting for the question regarding the taxation of unrealized capital gains, but it was never asked.
Sprinkle in a couple assassination attempts and you cannot help but wonder if there is anything you should do differently. Will the market rise? Will it drop? Should you shift out of the market and go deeper in cash or just sit tight? Will inflation shoot up if the Feds drop rates or will there be a recession? There are more questions than answers, for sure.
In any election, there is a heightened level of concern and awareness by investors. This year, particularly, there is even more elevated anxiety as the choice is between two paradoxical opponents.
It would be reasonable to expect this election year's uncertainty to substantially impact market sentiment and performance. However, markets have historically continued to rise in election years, and this year is no exception. We continue to see record highs. Clearly, the markets ignore whoever is poised to be at the helm, and portfolio positioning should generally be dictated by long-term planning rather than current events. | | I Can't Believe A Ticker Like This Exists Years ago, I came across a stock market ticker…
One that has been my "edge" ever since…
I trade it over and over again, every week…
And thanks to this one ticker, I hit on 93.6% of my trades in 2023.
Here's how you can too. | | | Five takeaways from election-year trading include: - Historically, markets have risen leading up to the election. There are no guarantees it will happen again, but the S&P 500 is currently up almost 20% year-to-date.
- Down-ballot races can be highly consequential. While the presidential race is paramount and the focal point, the congressional races are just as important, where control of the House and Senate is up for grabs. Should voters choose a president from one party but a Senate candidate from the other, that could have a significant impact on what the next administration is able to accomplish.
- Betting on specific policy or sector impacts come with risks. There can be dramatic differences between what is promised on the campaign trail and the actual policy changes that take place once the candidate is in office.
- Markets are nonpartisan. Traders do not care about one party over another, and evidence holds that no one party is "better" for the market than the other. In fact, the S&P 500 has historically averaged higher when governments are divided, suggesting that the gridlock creates less uncertainty. They simply do not get much done.
- Savvy investors continue to focus on the fundamentals, stick to their plans and avoid the election noise.
My personal opinion is that each candidate spews what he or she believes the populace wants to hear in order to get elected. Once in power, their rhetoric and policies may be somewhat tempered. Or at least, that's what I anticipate. One thing is for sure, American democracy will prevail and any significant deviation from the Constitution will be quickly rectified by its checks and balances. At least, I certainly hope that sanity will prevail.
Regarding the stock market, as long as it exists and we are able to freely trade, we can use mathematical models to put the odds in our favor and continue to make money. The math never changes; only how markets are manipulated. But that's for another discussion. | | Where are the record-setting stocks going? Wondering if you should be bullish or bearish on Nvidia for the remainder of the week?
Don't worry about "buying the news" or getting scared into selling when the A.I. can guide your way.
In other words, be rational.
The same A.I. that predicted the banking crisis, housing market crash and Covid crash recently forecasted 2 massively bullish moves for Nvidia.
Join me LIVE to learn how we're trading this ticker and 3 more with this A.I. forecast. | | | Leading up to the elections, I expect volatility to increase, although much of the movement will be based on the Federal Reserve's adjustments of interest rates. A major drop could trigger elevated inflation and related concerns, dropping the SPDR S&P 500 ETF Trust (SPY) with the expectation of a recession. Not only does news move markets, but the initial knee-jerk reaction to the news and subsequent analysts' interpretations will also affect prices. It's interwoven and complicated. Our job is to unpack it all and repackage it into something meaningful you can use to make money.
There is not much we do not discuss in the Trading Room. Nothing is off the table. You do not need to be proficient to be part of it. After all, the Trading Room is a learning tool, and you need to be there. Ahren and I call the shots every morning, 9:20 to 10:30 a.m. ET. Click here for details and to subscribe.
Still undecided? Join us at 8 p.m. ET, Sunday night for our weekly Intro to Trading / Week in Review. Register here.
Sincerely,
 
Hugh Grossman and Ahren Stephens
Editors, Trading Room, Pick of the Day, Inner Circle, and Signal | | About Hugh and Ahren:
 Hugh Grossman has manned the helm of DayTradeSPY for over a decade now. A self-taught trader, who turned master trader, has learned everything about trading the SPY (the SPDR S&P 500 ETF). Hugh has been guiding his subscribers of Inner Circle, Pick of the Day, DayTradeSPY Signal, and the Trading Room to daily profits since 2010.
 Ahren Stephens has been studying the markets since his teens. He opened his first trading account at the age of 18 and has studied the stock market, forex market, and commodities markets for more than 20 years. Ahren is a licensed commodity broker, and was most recently an analyst at an award-winning, multi-million-dollar firm. With his knowledge he has been guiding his subscribers of Inner Circle, Pick of the Day, and the Trading Room to daily profits. | | | | | |
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