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- šæ Take the election to the bank
šæ Take the election to the bank
How to play the stock market for either candidate
GM. Remember, remember, the fifth of November, gunpowder, treason, and plot.
The U.S. election is here. Weāre not going to give you any election opinions or coverage. But, we are going to tell you how to try to get rich playing the outcome.
Without Further Ado. ā *knuckle cracks* ā Letās get into it.
How will the market react to the election?
First, letās talk about the market as a whole. Hope drives things up more than any other factor. In general, a large group of people have hope after every election. So, again in general, the market will go up a few months after the election. If youāre going to argue that isnāt the case this time, we wonāt stop you, but this is the trend.
This doesnāt mean there will be an immediate reaction as a whole this week. It should also be noted that with such a close race across the board, we probably wonāt know for a few days who controls the presidency or the House.
āThis election comes amid a strong year for stocks that has pushed the broader market to all-time highs. With a gain of about 20%, 2024 has seen the best first 10 months of a presidential election year since 1936, according to Bespoke Investment Group.ā
Given itās been such a good year, can we really have a great close as well? Tbd. But if youāre still reading, I donāt think you care much about 2% on the S&P, so letās get more specific.
What if Trump wins?
There seems to be a consensus that a Trump victory will cause more volatility. Could be fun, so how can you play it? Here are some sectors that will almost certainly benefit from a victory for the host of The Apprentice:
Defense stocks
Simply, Trump will spend on the military. Some likely beneficiaries:
The VanEck Defense ETF
Booz Allen Hamilton
Palantir Technologies (might be too late on this one already)
Leidos
Lockheed Martin
Northrop Grumman
Oil and gas
Trump loves talking about bringing fossil fuels back within the border. Even if he canāt pull it off in practice, expect these guys to have a little pop:
EOG Resources
Exxon Mobil
Chevron
ConocoPhillips
Crypto
Heās already said he wants to make the U.S. the crypto capital of the world. Itās also safe to assume Elon would get involved, and we already know his stance. Place your bets.
Prison operators and firearms manufacturers
Probably the most controversial stance Trump has taken this time around: heās going to crackdown on immigration. This could mean more jail and more people buying weapons.
Geo Group
CoreCivic
Vista Outdoor Inc.
Smith & Wesson Brand Inc.
What if Kamala wins?
There is a general consensus that a Harris victory would lead to a little market depression, and especially for some of those who have gained this year on the backs of a possible Trump victory. She has proposed more regulations and a 28% corporate tax rate that would definitely have a short term negative impact. Here are some areas to consider for what would be the countryās first female president elect:
Green / Renewable Energy
This is an obvious one. Democrats win = renewable energy policy.
NextEra Energy
Plug Power
First Solar
Bloom Energy
Rivian (With Elon on Trumpās side, maybe Rivian has an edge under kamala?)
Healthcare
This is our first negative play. Harris has pledged to institute caps on drug prices, like insulin. This could crush profits for big pharma, so play the under.
Pfizer
Merck
Eli Lilly
Big Tech
Itās not a direct attack on them, but Microsoft, Apple, and Alphabet have been the 3 highest tax payers already. A much higher corporate tax would probably have a negative impact on them and the rest of the silicon valley squad.
Homebuilders
This is a less obvious one that may take some time to move, but Harris has pledged to build more homes and reduce costs for renters and home buyers through tax incentives.
D.R. Horton
KB Home
Lennar
PulteGroup
Zillow Group
Closing thoughts
Of course everyone has their own opinion, DYOR, this is not financial advice blah blah BLAH.
What will actually happen over the next 4 years? We have no idea. Look at the last 4. All we know for sure is that it seems the country has never been more divided.
Thereās volatility coming.
Playing a few in both directions is probably wise. Having said that, we also see stories every election of some jabroni on Robinhood turning 2k into a million dollars off a single trade.
Bet, or uhh I mean invest, wisely.
What Weāre Reading
Metaās plan for nuclear-powered AI data centre thwarted by rare bees
Physical Intelligence, a Robot A.I. Specialist, Raises $400m From Bezos
Musk and X are epicenter of US election misinformation, experts say
Binance bets on Thailand as region signals supportive crypto approach
AI agents trading crypto is a hot narrative, but beware of rookie mistakes
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