Investors often wonder whether the market will rise or fall based on who is elected president. The data show that capturing the long-term returns of the capital markets does not depend on which party controls the White House. In a recent webcast, Dimensional’s Mark Gochnour and Jake DeKinder offered lessons from history. See the very brief video below.
And in this Vanguard article, key points which we’ve summarized below, learn about market behavior in election and non-election years, and in the 100 days before/after the election.
Key takeaways from Vanguard article
Annualized Returns in Election Years: 8.9% (40 periods)
Annualized Returns in Non-Election Years: 8.1% (120 periods)
Volatility (annualized percent) in 100 days before an election: 13.8%
Volatility (annualized percent) in 100 days after an election: 13.8%
Volatility over the entire time: 15.7%
Looks like the market has no significant reaction to elections.