How the Market Reacted to the Election
Updated: Aug 29, 2019
Wow! What a surprise ending to a very long presidential election process. On election night, I was attending an investment conference in Los Angeles. By the time I fell asleep later that night, the election results had not yet been determined, but the market futures were already down about 800 points.
Imagine my surprise when I got up the next morning and the market was UP over 200 points. The following day it was up again. Now this may have been irrational exuberance, but it proves the point that it's really hard to determine the course of the market in the short term.
We expect, and history shows that over the long term, the market will go up. But we can’t predict the short term direction of the stock market. Because of this, it's always important to take a long term view of your investments. Don't watch the day to day gyrations of the market. Emotionally reacting to either up or down short term movements of the market will only leave you frustrated.
Instead, invest for the long run. Buy good quality investments. Diversify across different asset classes - Large, Small, International, REITs, Growth, Value and Bonds. This is what will determine your investment returns in the long term.
The above is considered to be general tax/financial information and is not intended to be used as tax/financial advice. If you believe that any of the above applies to you, please consult with a tax or financial professional. See our Legal Statement.