The 2020 election is moving closer to conclusion, and like many investors, you may mixed emotions about the future. If you're looking for clarity and guidance, here are some key points for refocusing the post-election stress and anxiety back to your financial plan. Investors have historically been rewarded for staying invested rather than investing on who is in political office. We have written about this in past commentary that stock markets trade better on clarity and once the clouds of uncertainty begin to clear, markets will move quickly towards the opportunities ahead. Below are some charts from Schwab and LPL Research to provide you with some investment perspective.
Election Years Tend to End on a High Note
The S&P 500 Index tends to do very well in the final two months of the year, especially during election years. November has been a strong month already, which started moving strongly to the upside since election day. Investors that remained invested and held to their investment plan have been rewarded. There will be winning and losing stocks and sectors based on the election, which your Sandbox Financial team will help guide your portfolio towards areas of opportunity.
Our Investment Outlook Remains Positive into 2021
In the near term, we continue to monitor COVID-19 cases, potential economic closures and progress on a COVID-19 vaccine. In January, we are closely watching the Senate run-off election as a divided congress has historically been better for stock market returns. We do expect a large economic stimulus package in early 2021, add in historically low interest rates and a tremendous amount of liquidity and cash looking for return, our investment outlook remains positive and opportunistic headed into next year.
To review your investment portfolio or financial plan, please contact your Sandbox Financial planner. If you are not a client of Sandbox but would like a free evaluation of your investments, please contact us today.