What History Tells us About US Presidential Elections and the Market

Our colleagues at Dimensional Funds shared these stats with us, so we thought it a prudent time to share the information here,  on our weekly blog.

  • It’s natural for investors to look for a connection between who wins the White House and which way stocks will go. But as nearly a century of returns shows, stocks have trended upward across administrations from both parties.
  • Shareholders are investing in companies, not a political party. And companies focus on servicing their customers and growing their businesses, regardless of who in the White House.
  • US presidents may have an impact on market returns, but so do hundreds, if not thousands, of other factors – the actions of foreign leaders, a global pandemic, interest rate changes, rising and falling oil prices, and technological advances, just to name a few.
  • Stocks have rewarded disciplined investors for decades, through Democratic and Republican presidencies. It’s an important less on the benefits of a long-term investment approach. 

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