SA: Q+A Vol. 1
Client Question: “How will the upcoming elections affect my portfolio?”
My Answer:
The stock market is apolitical, meaning it does not matter which party is elected. The stock market just wants a strong economy, which leads to a strong stock price.
Over the long run, the stock market will follow the economy. If the economy is growing, this creates an opportunity for companies’ sales growth and profits growth. This growth leads to the hiring of more employees. These employees’ earnings will be spent and saved, which will create even more growth in the economy.
In the short-term, the stock market represents the expectations of economic growth and individual stocks. These expectations can swing considerably day by day or month by month. Therefore, we have so much volatility in the stock market.
The upcoming elections could lead to a split-government, meaning the House of Representatives is from one party and the Senate is from another party like we have currently. Alternatively, we could have a government all from one party which could lead to greater change.
Whichever is the case, it is important to have both a strategic investment process for the long run and a tactical investment process to handle the short-term possibilities. Over the last 20 years, we have developed a program that does just that. Our program invests in the long-term while taking advantage of the opportunities that come up in the short-term. If you would like more information about our firm and this process that has helped so many people, please contact Stewardship Advisors today.
W Lee Shertzer
Managing Partner, Stewardship Advisors, LLC
