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September 6, 2016 Article 1 min read

Executive summary 

  • With the U.S. Presidential election approaching, it’s an opportune time to examine what history does and does not tell us about the relationship between U.S. Presidential elections, the capital market, and investors. 
  • Both candidates have proposed a number of policies that would have economic impacts.  However, the reality of either having the ability to enact sweeping reform once in office remains doubtful.
  • While the past can often provide useful information, investors would be well served to maintain caution when drawing conclusions about market and economic performance during past election cycles.  Relying on historical data assumes that past election year returns were driven by the election itself – which is generally not the case. 
  • Election anxiety may fuel an investor’s urge to “do something.”  Instead, we advise investors to maintain a long-term view and not allow the often negative undertones and politically motivated warnings to sway their investment decision-making.
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