The most common question we have been getting the past 3+ weeks (and it is not even close) is some form of “do we need to make any changes to our investments before the election?” If you have asked this, or thought this, just know that you are not alone. History suggests that from a long term investment standpoint elections (and often their outcomes) have little to do with market returns. I have included a link below to a piece from Capital Group to help give this more context. In this report, page 3 gives visual of returns going back to 1933 based on which party controlled The White House (5 Republican, 5 Democratic Presidents).
Last August I wrote (that feels like 5 years ago now) Volatility is normal. Elections provide a certainty of a date on the calendar, and as a result become an easy "mental benchmark" to attempt to plan and invest around. Elections also create headlines and talking points about all that is wrong with the world, and 2020 has provided no shortage of that. I have no idea which candidate will win the Presidency, nor (and perhaps more importantly) which Party will control the House/Senate. We also have no idea what this will mean for market returns moving forward. Instead, we feel it is more prudent to make investment decisions based on individuals' needs and goals and invest accordingly.
On our family's recent trip out west, my oldest two daughters were asking me about elections; one of their first questions they had was how many Presidents I have voted for? (what they were really asking is how many times I have voted for a President). After this year it will be 6 - my first Presidential election was Bush vs Gore in 2000 - what a time for a Political Science major in college! God willing, I am hoping to participate in 15 more.
Hoping everyone reading this is both physically and mentally healthy, and as always if there is anything you would like to discuss please don’t hesitate to reach out.
Andy