Super Bowl winners, Triple Crown winners, and Sports Illustrated covers — all of these have been used to develop theories about the direction in which stock markets may be headed. Historically, economists believed people's financial decisions were grounded in rational thought and a single-minded pursuit of their best interests.

Cash is still king in U. Theories about the economy were built on the notion that people unconsciously understand probabilities and make rational decisions. Psychologists and sociologists, however, weren't convinced people were as rational as economists believed.

Sociologists have found that having limited time and brainpower meant many people did not make well-informed decisions. When it comes to investing, there are an abundance of rules of thumb. Since it's an election year, you've probably encountered at least one article discussing the ways in which elections may affect stock markets and the economy. This is because before an election, politicians tend to promote a pro-business agenda so the economy is strong, the stock market is moving higher, and voters are feeling optimistic.

Analysts who have tirelessly crunched the data have found that U.

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There have been some notable exceptions in recent years during the final years of the Clinton and G. While history does suggest that the performance in years three and four of a presidential cycle are indeed stronger, many pundits argue that the true driver of performance is the overall macro economy, not the election cycle. Inresearch published in the Journal of Finance indicated large company stocks did better under Democratic administrations.

Overcome your fear of public speaking to grow your business. Later research from the Federal Reserve showed the difference in large company stock returns under Democratic and Republican administrations was negligible after you controlled for risk.

This theory is very difficult to prove accurate without factoring in other how to use club penguin cp money maker download that can move the markets, such as the state of the economy and the stance of the Federal Reserve's monetary policy.

The theory states that as the stock market increases, especially when it is increasing at an ksg invest binary options rate, the stock market prediction of presidential election popularity ratings tend to improve.

Others have interpreted this theory to say that stocks rise and fall with a president's approval rating, and not the other way around.

In other words, investors' anxiety increases, causing markets to become more volatile when they begin to wonder how the presumptive winner's policies may affect the economy. This provides little data for investors since economic growth does not always translate into strong stock returns.

In the richest currency trader, this is because economic growth may be the result of new businesses forming rather than existing ones growing.

Secrets of forex trading, a lot of thought stock market prediction of presidential election been given to the influence of presidential cycles on saxo bank forex peace army stock market.

U.S. Presidential Election Markets - Iowa Electronic Markets - The University of Iowa

Some theories that inform rules of thumb are clearly better researched than others. Regardless, none appear to provide actionable information that has the potential to benefit long-term investors. In fact, it is our opinion investors would be better served by selecting an investment strategy that meets their long-term financial goals rather than chasing returns based on political outcomes.

As a wealth adviser for Desepoli Wealth ManagementMike Desepoli serves as a wealth management resource to business owners and executives, assisting them in making proactive, personal financial decisions.

Mike's vision is to help clients live for today, as well as plan for tomorrow. He believes in making the complicated simple, by educating his clients so they can feel more confident about the decisions they make regarding their financial health.

For more DAILY VIEWS, The News' new contributor network, click here. New York Daily News lifestyle.

Stock markets have predicted almost every US election. This time they say Trump will win | The Independent

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Get the latest breaking news, entertainment, sports and more. Subscribe to the newspaper, our e-edition, or both. Select Sport Football Basketball Baseball Hockey Soccer Golf College More Sports Health Food Viva Share This facebook Tweet email. Can presidential election years forecast stock market movement? Monday, May 16,6: Presidential elections — along with Super Bowl winners, Triple Crown winners and Sports Illustrated covers — have all been used to develop theories about the direction in which stock markets may be headed.

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