Nervous About Stock Markets and Elections?

PHOENIX - June 3, 2024 - PRLog -- Matt Coffina, CFA and Trajan Wealth's portfolio manager for Expanding Moat and Defensive Moat strategies, discusses the connection between elections and the stock market.

Strong Q1 For Stocks Features Improved Breadth

Stocks had a solid start to the year, with the S&P 500 gaining 10% in Q1, though it lost nearly half of that in April. Investors are focused on the Federal Reserve's rate decisions for 2024. Inflation has dropped from a peak of 9% in mid-2022 but remains above the Fed's 2% target. The U.S. economy appears healthy overall, reducing the need for immediate rate cuts.

Big tech continues to dominate, with high enthusiasm for AI. However, market breadth has improved, with sectors like energy, financials, and industrials contributing to gains. Real estate is lagging due to challenges like office vacancies and higher interest rates. Concerns about consumer health persist, with key consumer discretionary stocks underperforming.

Stocks and Elections

Investors are anxious about the upcoming election, regardless of their political leanings. Historical data shows the S&P 500 typically gains 12% in the year following an election, performing well under both Democrats and Republicans.

We advise clients to vote based on their political beliefs but not let elections dictate their investment decisions. Many factors beyond who the president is influence the market. For instance, Bill Clinton oversaw the dot-com boom, while George W. Bush faced the dot-com bust and the 2008 financial crisis. Barack Obama benefited from post-crisis recovery.

From 1952 to 2023, the S&P 500 grew $1 into $1,706, an 11% annual return, showcasing the resilience of the U.S. economy and markets, regardless of political leadership.

Contact a Trajan Wealth fiduciary advisor to make sure your portfolio is election-ready!

About Trajan Wealth

Trajan Wealth, LLC was founded in 2012 by CEO Jeff Junior. Before his 20+ years in the financial services profession, Jeff served in the United States Marine Corps. He continues to serve his clients and employees with the utmost service, respect, and attention to detail.

By using low-cost, diversified portfolios under its fiduciary standard and working closely with its investment advisors and estate attorneys within one office, the company provides long-term support for clients' retirement needs and estate plans, including wealth accumulation and tax planning strategies. The firm has locations across Arizona, Colorado, Florida, Georgia, Texas, Utah, and soon Illinois.

Schedule a complimentary consultation at https://trajanwealth.com or 1-800-838-3079.

Disclaimer:

*Advisory services offered through Trajan® Wealth L.L.C., an SEC registered investment advisor. Legal services are offered through ​Trajan® Estate, L.L.C. ​in Arizona and Utah, and independent law firms in other states.