How Elections Affect Share Market

The market gained an average of 45 9 with democratic presidents compared to 19 1 under republicans measured from election day to election day with recent closing used for the trump term of.

How elections affect share market. As a result the stock market goes up. Traditionally stock markets are deemed as the barometer of economy which in turn is driven by a slew of government policies being financed and formulated under the supervision of prime leader or prime minister of the country. If people believe that the policies will result in the country growing they become optimistic and hence money pours into the market.

The stock market almost always outperforms in the end. That said there are some general rules of thumb for traders to keep in. Historically elections are seen having a short term yet a strong impact on the stock markets.

So when it comes to where you keep your money you should stay the course no matter who wins this election. How the election might affect stock prices trump says a democratic victory next week will send stock prices plummeting. While there could be volatility in the market leading up to the election as investors turn risk averse the outcome of the election will be bullish for stocks lee said.

But wall street ambivalent about the prospect of a biden presidency. Answered april 25 2018. Exactly how the election affects the markets would likely change based on three different potential outcomes link said.

Bank noted stock markets have a habit of closing slightly lower while bond markets outperform. The first scenario is the status quo where president donald trump is. Following an election year u s.

Most experts say it is hard to predict anything concrete about the impact of the upcoming election on the stock market. After an election stock market returns tend to be slightly lower for the following year while bonds tend to outperform slightly after the election. The election may take the market for a ride in the short term but in the end as long as you keep going with your long term strategy you should do just fine.