I’m back at it, writing again from the cozy confines of my home office. The race between Kamala Harris and Donald Trump is neck and neck, and let us be honest, polls these days are about as reliable as trying to predict the weather with a fortune cookie. So take those numbers with a grain of salt.
I have had more than a couple of investors asking how the 2024 US presidential election might shake up the US stock market and the economy. While I will save the juicy details for our next webinar with partners and investors, here is a little something to cool some of you down.
Every now and then, I find myself trying to reason with some people who happen to be Trump supporters. Well, Trump does bring some unique factors to the table. He is very America-First, which is not exactly great news for our trading partners.
Will the election rattle the markets? If you ask BlackRock founder and CEO Larry Fink, the answer is a big, fat “no.” The head honcho of the world’s largest asset manager recently said he is tired of hearing about the election having any lasting impact. His take? “The reality is, over time, it does not matter.”
As for me, who is not exactly managing BlackRock-level money, it does not matter either. I do not really care who wins. Sure, I expect a bit of volatility, maybe a close race where the losing side refuses to concede but honestly, it will pass like a bad hair day. I know that even a 10% correction will feel like a crash.
It is easy to get caught up in the noise, but the real challenge is keeping a long-term perspective. Overhauling portfolios just for an election rarely makes sense, and there is no need to tweak any of our positions including our short-term trades as they are already well-hedged.
According to Bloomberg data, during Trump’s administration, the S&P 500 gave 61.54 per cent returns. The index gave 62.84 per cent returns during Joe Biden’s presidency (till September 1, 2024).
Here is my advice. Go outside, take a walk, read a book, enjoy dinner with your family, and maybe hang out with friends. For your own sanity, make a plan to tune out the election drama a little early this year. There is no need to wake me up in the middle of the night.