This week, I’m talking about opportunities and risks in today’s stock market and what you should be paying attention to as an investor right now. 

In the latter part of the week, I’m shifting to the risks in today’s stock market, and today I’m talking about the real risk of the upcoming election. 

Back in July, I devoted an entire week’s worth of the podcast to the nuances of investing in an election year, so if you want to dive a little deeper you can go back through the archives to episodes 645-651.

Now in a typical election year, if you go back almost 100 years to the 1930s, you don’t see much impact on the stock market during an election year. In fact, the stock market was usually higher overall during an election year. 

An election year means potential changes to policy, laws, taxes, regulation, etc., but historically, the stock market’s reaction tends to be pretty muted, no matter what happens. However, with the current political tensions, civil unrest, and Covid, this election year is shaping up to be like no other, which means I wouldn’t be surprised to see heightened volatility or big up days and big down days in stocks as the election approaches.

I don’t think there is anything to do about this expected volatility, other than to be aware that it’s likely coming, and no matter who is elected President for the next 4 years, the stock market could react strongly in the short-term, yet the person in the white house for the next 4 years won’t have as much impact on the stock market or your portfolio as the media would have you believe. 

Thank goodness we live in a democracy where changes to policy, regulations, and taxes tend to be slow moving, so any changes that may result from November’s election will likely get baked into the stock market slowly over time. 

That’s it for today, thanks for listening. Tomorrow, we’re going to recap the week and I’m gonna give you a little taste of next week’s theme.

My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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