Does the stock market really care whose in office?👇
Based on historical data, the answer is not really.
Over the long term, the stock market has done well under both Democratic and Republican administrations, per data from The Motley Fool.
From a mean perspective, the S&P 500 $SPX has grown annually at 9.8% under Democratic presidents, outpacing the 6% under Republicans since 1957.
However, looking at median growth rates, the market has seen 10.2% growth under Republicans and 8.9% under Democrats.
While either party could make the case that the stock market performs better during their party, the direct impact of policy remains hard to quantify.
Furthermore, presidential terms are susceptible to unforeseen events like the dot-com bubble, the 2008 financial crisis, and Covid-19, to name a few.
As always, the name of the game is time in the market, not the president’s political party.
The S&P 500’s compounded annual growth rate of 10.26% is a clear testament to that.
