Presidential Election Years and Stock Market Performance
Excerpt from the "We Study Billionaires" Podcast
Below are a few interesting facts on presidential election years from The Stock Trader’s Almanac:
Presidential election years are the second-best performing years of the four-year cycle producing losses of greater than 5% in only six of the thirty-two election years since 1896. It is worth noting that the incumbent party lost power in five of those elections years when losses exceeded 5%.
The stock market as measured by the S&P 500 does better in years when a sitting president is running (advancing 12.8% since 1949) versus a loss of 1.5% when there is an open field.
Regardless of which party wins the election, the last seven months of the election year have seen gains on the S&P in 16 out of the 18 presidential election cycles since 1950.
When the S&P 500 is up from July 31st to October 31st during presidential election years, the incumbent party retains power 85% of the time going back to 1936. Declines in the S&P 500 during these same three months have seen a shift in party control in 89% of instances.
2024 promises to be anything but normal in terms of the presidential election, so counting on history may not be as instructive as in past instances. Investors should instead be focused on the companies they own and ideally take a time frame that surpasses a typical presidential election term.
Important Disclosures. The information herein is provided by Boyar’s Intrinsic Value Research LLC (“Boyar Research”) and: (a) is for general, informational purposes only; (b) is not tailored to the specific investment needs of any specific person or entity; and (c) should not be construed as investment advice. Boyar Research does not offer investment advisory services and is not an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”) or any other regulatory body. Any opinions expressed herein represent current opinions of Boyar Research only, and no representation is made with respect to the accuracy, completeness or timeliness of the information herein. Boyar Research assumes no obligation to update or revise such information. In addition, certain information herein has been provided by and/or is based on third party sources, and, although Boyar Research believes this information to be reliable, Boyar Research has not independently verified such information and is not responsible for third-party errors. You should not assume that any investment discussed herein will be profitable or that any investment decisions in the future will be profitable. Investing in securities involves risk, including the possible loss of principal. Important Information: Past performance does not guarantee future results.
This information is not a recommendation, or an offer to sell, or a solicitation of any offer to buy, an interest in any security, including an interest in any investment vehicle managed or advised by affiliates of Boyar Research. Any information that may be considered advice concerning a federal tax issue is not intended to be used, and cannot be used, for the purposes of (i) avoiding penalties imposed under the United States Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter discussed herein.