View Single Post
Old 12-01-2015, 10:11 AM   #9
Draft Pick
Buzzcock's Avatar
Join Date: Jul 2012

Originally Posted by GGG View Post
There haven't been enough elections in the U.S. For this to be anywhere near statistically significant.

For example from 1978 to 1998 in every year but 1990 if the NFC team won the Super Bowl the Dow went up that year, if the AFC team won the market went down.

Correlation does not equal causation.
I can't speak specifically to what's in the Fisher article I referenced but a more general correlation between election cycles and market performance is well known and is statistically significant. The first couple years of a term tend to underperform the latter two years. If you're worried about sample size this tends to be true not only in the US but also other western economies including Canada's.

So where's the causation between election cycle and market performance? It's believed to be due to market friendly policies being enacted as a re-election attempt approaches.

I'm not saying I buy into this and I certainly don't trade on this basis - just food for thought. Personally, I've been largely on the sidelines for over a year now as I struggle to understand the extended sluggish demand for primary materials with a continued bull run. That says bubble to me.

Having said that.....go NFC.
Buzzcock is offline   Reply With Quote