When faced with uncertainty, we understand the natural human reaction to worry. An example of uncertainty in 2024 is the upcoming Presidential election. Our political elections in the U.S. have become very polarizing, with each side thinking that if the other party wins then our country (and economy and stock market and you name it…) will crumble. So, is that a reason to worry?
As a client once so wisely said to me, “Why worry twice?” What she meant was, you can waste your time and energy worrying about something that may never even happen, or certainly not happen to the degree you are worrying about.
We think the same way about the stock market and elections. There is no benefit to worrying about which person will become President, which party will win the House or Senate, or how long the election results will take to become official. However, what should be our focus is the long-term power of the market, pulled forward by the best and most innovative companies our world has ever seen. Here are some things we know, and lean on when there could be the tendency to worry:
- We are investing in companies, not political parties.
- The President is just one person. There are so many other factors that can impact markets.
- Over the long-term, stocks have rewarded investors no matter who is in office.
- A century of data (below) shows us that markets go up no matter which political party is in the White House.
If you have any questions about your investment portfolio, please contact your Woodward advisory team. We may not be able to predict who is going to win the election, but we’ll be able to give sound advice that makes the result irrelevant to your long-term investing success.
Written by Jim Miller, CFP®