Why Buy Stocks In A Presidential Election Year? History Has A Crazy Stat For You
Portfolio Pulse from Chris Katje
Historical data suggests that the S&P 500 often outperforms in presidential election years, with an average return of 10.5% over the last 16 election years, excluding the global financial crisis and dot-com bubble. The SPDR S&P 500 ETF Trust (SPY) has seen a 23.7% increase since Biden's presidency began. The Dow Jones Industrial Average, tracked by the SPDR Dow Jones Industrial Average ETF Trust (DIA), has had mixed results in election years, with an average return of 5.4%. The Nasdaq 100, often tracked by the Invesco QQQ Trust Series 1 (QQQ), has an average return of 7.4% in election years since its creation in 1985. The performance of these indexes during election years is a point of interest for voters and has been highlighted by both Biden and Trump.
December 28, 2023 | 7:16 pm
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NEUTRAL IMPACT
The SPDR Dow Jones Industrial Average ETF Trust (DIA) has shown mixed performance during presidential election years, with an average return of 5.4% over the past 16 election years.
The Dow Jones Industrial Average's mixed performance in past presidential election years suggests a neutral outlook for DIA, making it less clear how it will perform in the short term.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The Invesco QQQ Trust Series 1 (QQQ), tracking the Nasdaq 100, has an average return of 7.4% in presidential election years since 1985, indicating potential for positive performance.
The Nasdaq 100's historical average return of 7.4% in presidential election years suggests that QQQ could experience positive performance in the short term, especially given its tech-heavy composition.
CONFIDENCE 70
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
The SPDR S&P 500 ETF Trust (SPY) has increased 23.7% since Biden took office, with historical data suggesting potential outperformance in the upcoming presidential election year.
Given the historical trend of the S&P 500 outperforming in presidential election years and SPY's positive performance since Biden's presidency, there is a likelihood of continued positive momentum in the short term.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90