Waiting for ‘your team’ to win before you invest?


Every four years, politics and finance converge as Americans elect a president and investors try to figure out what the outcome means for their portfolios. In other words, should we be doing anything different with our money right now?

Assuming that we have a prudent, well diversified and cost-effective investment strategy, I emphatically argue NO! The question about presidential elections and their impact on the markets is one I hear a lot, especially every four years. In the final analysis, presidential elections may not matter to the stock market as much as we may think. I will attempt to make a convincing argument of how stocks perform with a Democrat or Republican president might have a lot less to do with the candidates than the economic backdrop.

Since 1945, statistics show if we had invested in the Dow Jones Industrial Average only when a Democrat was president, we would have performed better than if we had invested only if a Republican was president. If we would have stayed fully invested during this time. Boo-yah! Need I say anything more about waiting for your team to win before investing?

There will always be reasons not to invest in the stocks, but history has repeatedly proven that, over time, stocks climb the wall of worry and eventually set new highs. For instance, in the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a president. Yet the Dow Jones Industrial Average rose from 66 to 11,497.

Please do not misunderstand me; investing in stocks and bonds is a dangerous endeavor that requires us to prepare diligently for incredible volatility. I do suggest, however, that we make investing in stocks and bonds much more complicated than what it needs to be. Said differently, our lives are forever controlled by two emotions – fear and greed. When these two sensations present themselves, self-control requires incredible attention and effort. Regrettably, far too many folks hit the panic button, and reason often goes out the window along with their wallets and purses.

In the end, some basic principles endure: diversification, discipline, consistency and the value of experienced guidance. Perhaps I am too much of an optimist, but I steadfastly believe what the consummate visionary, Winston Churchill, said about being an optimist: “It does not seem too much use to be anything else.”

Harry Pappas Jr., CFP®

Managing Director-Investments

Certified Estate and Trust Specialist™

Certified Divorce Financial Analyst®

Pappas Wealth Management Group of Wells Fargo Advisors

818 A1A N, Ste. 200

Ponte Vedra, Florida 32082



The use of the CDFA™ designation does not permit Wells Fargo Advisors or its Financial Advisors to provide legal advice, nor is it meant to imply that the firm or its associates are acting as experts in this field. Wells Fargo Advisors is not a legal or tax advisor. You should consult with your attorney, accountant and/or estate planner before taking any action Wells Fargo Advisors LLC, Member SIPC, is a Registered Broker-Dealer and a separate non-bank affiliate of Wells Fargo & Company.

The report herein is not a complete analysis of every material fact in respect to any company, industry or security. The opinions expressed here reflect the judgment of the author as of the date of the report and are subject to change without notice. Statistical information has been obtained from sources believed to be reliable, but its accuracy and completeness are not guaranteed. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request. Diversification does not guarantee a profit or protect against loss. Past performance is no guarantee of future results. Investors cannot directly purchase any index.