Since you liked my post, I am assuming that this is the First foundation investment firm you are talking about. Now read the link below. You have been caught lying my friend. Read carefully the section on "The U.S. presidential election"
https://blog.ff-inc.com/enjoy/the-eye-of-the-hurricane
The U.S. Presidential Election
Each time a U.S. presidential election approaches, we get questions from clients about our view and the impact on our investment outlook and portfolio positioning. We are being asked about the election even more than usual this year. Here is a quick review of how we think about elections in general within the context of our overall investment approach.
While the specific circumstances of any given election are unique, our approach remains essentially the same. First, to the extent a particular result is widely expected, current asset prices will reflect the market consensus. In order for us to believe there is a tactical investment opportunity stemming from a particular election outcome, we would need to believe (1) we have an edge in assessing the outcome more accurately than the market does and (2) our view is materially different from the consensus.
There is too much uncertainty and there are too many non-election variables that impact investment outcomes for us to likely see any value in positioning our portfolio for a particular result. Even if we had a higher degree of certainty as to both the outcome
and the policies that would be implemented, the ultimate economic effects and outcomes would still be highly uncertain. Macroeconomics is far from a hard science, and there are a multitude of other factors and variables that impact economic and financial market outcomes beyond U.S. fiscal and monetary policy.
In sum, (1) we are not willing to bet on a particular election result relative to the odds already embedded in current market prices, (2) there is a wide range of potential macro outcomes around either result, and (3) there are a multitude of other variables and factors unrelated to the election results and outside of U.S. politicians’ control that are likely to have at least as meaningful an impact on the course of the global economy and financial markets over the next five years.
Instead of betting on election results, we stick to our longer-term analytical framework, in which we consider and weigh multiple macro scenarios, and assess the potential risks and returns for numerous asset classes and investments in each scenario. As investors, we expect to experience market price volatility and shorter-term downside risk at times – the degree of which will depend on the client’s investment objective, risk tolerance, and the corresponding risk exposure of the portfolio. Stock market history makes this clear. Volatility comes with the territory in stocks and other risk assets.
With that said, our research into the impact of the presidential election on the stock market has resulted in some interesting conclusions. Presidential election years can be among the most volatile for the stock market. Since 1900, the S&P 500 has fallen on average 1.2% in year eight of an administration. That clearly doesn’t apply to this year, with the stock market up nearly 8%. But we are bracing for potential volatility surrounding the election nonetheless. The market appears to be betting that Hillary Clinton will be victorious in November. Clinton is viewed by investors as the candidate of continuity (for better or worse, depending on your political perspective), and thus with Clinton, investors have less uncertainty with regard to future policies. What the market dislikes most is uncertainty. A Trump victory, should it occur, would likely come as a surprise and thus could cause a pullback in financial markets as investors assess the uncertainty associated with Trump. But we think such a pullback would likely be temporary.
The average compound annual growth rate of the S&P 500 since 1945 has been better under Democrat administrations, at 9.7%, than under Republican administrations, at 6.7%. However, the highest growth rate of 18.6% occurred under a Republican administration (Gerald Ford). The second-highest growth rate of 14.3% occurred under Bill Clinton. We conclude from this that there are too many factors, other than simply the party in the White House, that influence the growth rate of the stock market.
Which party prevails in an election does seem to impact individual sectors of the economy. Historically, Democratic administrations have tended to be good for health care, education, and alternative energy (although, in this case, a Clinton presidency could pose a serious challenge for the health care industry). Republican administrations have tended to be good for energy, financials, and defense. However, whichever party is in the White House, whether the president is able to accomplish his or her agenda will depend to a large extent on whether their party also controls Congress – and, right now, that question is up in the air. In any case, at the moment, we aren’t making any changes to our portfolio positioning based on the presidential election.