CLIENT RESOURCE KIT
ELECTION
GROWTH OF $10,000 IN THE S&P 500 INDEX SINCE 1949
Source: Standard & Poor’s, FT Advisors. Data is quarterly from 1949 – Q3 2023.
Past performance is no guarantee of future results. For illustrative purposes only and not indicative of any actual investment. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance. Investors cannot invest
directly in an index. Index returns do not reflect any fees, expenses, or sales charges. These returns were the result of certain market factors and events which may not be repeated in the future.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any
other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
Not FDIC Insured | Not Bank Guaranteed | May Lose Value
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
1949
1954
1959
1964
1969
1974
1979
1984
1989
1994
1999
2004
2009
2014
2019
Fully Invested
Growth of $10,000 Republican
Growth of $10,000 Democrat
2023
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
AVERAGE
S&P 500 Index Performance: 4-Year Election Cycle
Source: Morningstar/Ibbotson Associates. Past performance is no guarantee of future results. For illustrative purposes only and not indicative of any actual investment. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market
performance. Investors cannot invest directly in an index. Index returns do not reflect any fees, expenses, or sales charges. These returns were the result of certain market factors and events which may not be repeated in the future.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or
any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
On and around election day there is often some anxiety about how a president’s 4-year term might impact the stock market. Below we look at S&P 500 Index performance by year of each election cycle. Over the past 92 years,
the S&P 500 Index has seen positive performance 73% of the time, and has averaged a yearly total return of 11.54%. Seeing the big picture can help us to stay focused on our long-term investment goals.
• 67 of the 92 years (73%) provided positive performance
• The average total return for a 4-year term was 46.18%
• When a Republican was in office the average yearly total return was 7.85%
• When a Democrat was in office the average yearly total return was 14.93%
Observations
First Year (Avg. 9.88%)
Second Year (Avg. 8.47%)
Third Year (Avg. 17.64%)
Fourth Year (Avg. 10.19%)
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
Not FDIC Insured | Not Bank Guaranteed | May Lose Value
S&P 500 Index Performance by President and Makeup of Congress
Source: Morningstar, Bloomberg. Past performance is no guarantee of future results. This chart is for illustrative purposes only and not indicative of any actual investment. These returns were the result of certain market factors and events which may not be repeated in the
future. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance. Indices do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the performance shown. Investors
cannot invest directly in an index.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue
Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
0%
5%
10%
15%
20%
25%
Split
Democratic
Republican
Split
Republican
Democratic
Average S&P 500 Index Total Return Annual Performance 1950-2022
13.5%
18.5%
16.0%
10.7%
7.5%
17.6%
Makeup of Congress
Democratic President
Republican President
S&P 500 Index Returns In U.S. Presidential Election Years
Since 1928
Source: Morningstar/Ibbotson Associates. Past performance is no guarantee of future results. For illustrative purposes only and not indicative of any actual investment. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock
market performance. Investors cannot invest directly in an index. Index returns do not reflect any fees, expenses, or sales charges. These returns were the result of certain market factors and events which may not be repeated in the future.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any
other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
There are many factors that impact stock market returns, but one common concern of
investors is how the stock market will be impacted by a change in America’s President.
In past election years, the S&P 500 Index has seen more positive performance than
negative. Below we take a look at S&P 500 Index performance during presidential
election years, which have historically provided positive gains for stocks.
S&P 500 Index Total Returns During Presidential Election Years (1928-2020)
U.S. Presidential Election Results
Average Return
A Republican was elected
15.3%
A Democrat was elected
8.5%
All election years
11.58%
Observations
There have been 24 elections since the S&P 500 Index began. In these election years:
• 20 of the 24 years (83%) provided positive performance
• When a Democrat was in office and a Democrat was elected (or reelected), the total return
for the year averaged 15.0%
• When a Democrat was in office and a Republican was elected, the total return for the year
averaged 12.9%
Historical U.S. Presidential Election Results
Election Year
President Elected
S&P 500 Index
Total Return
2020
Biden
18.4%
2016
Trump
12.0%
2012
Obama
16.0%
2008
Obama
-37.0%
2004
Bush W.
10.9%
2000
Bush W.
-9.1%
1996
Clinton
23.1%
1992
Clinton
7.7%
1988
Bush H.W.
16.8%
1984
Reagan
6.3%
1980
Reagan
32.4%
1976
Carter
23.8%
1972
Nixon
19.0%
1968
Nixon
11.1%
1964
Johnson
16.5%
1960
Kennedy
0.5%
1956
Eisenhower
6.6%
1952
Eisenhower
18.4%
1948
Truman
5.5%
1944
Roosevelt
19.8%
1940
Roosevelt
-9.8%
1936
Roosevelt
33.9%
1932
Roosevelt
-8.2%
1928
Hoover
43.6%
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
S&P 500 Index Total Returns: First Year Of A Four-Year Presidential Term
Source: Morningstar/Ibbotson Associates. Past performance is no guarantee of future results. Data shows first year returns of the last 12 presidential terms. This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the
effects of taxes and brokerage commissions and other expenses incurred when investing. Investors cannot invest directly in an index. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any
other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
Not FDIC Insured | Not Bank Guaranteed | May Lose Value
-7.2%
-4.9%
32.2%
31.5%
10.1%
33.4%
-11.9%
4.9%
26.5%
32.4%
21.8%
28.7%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
2017
2021
Democrat (Average: 20.6%)
Republican(Average: 12.3%)
How Stocks Have Fared In The First Year Of A Four-Year Presidential Term
S&P 500 Index & Sector Index Total Returns
2021
Democrat
Democrat
Democrat
28.68%
21.57%
24.43%
18.63%
54.35%
34.87%
26.13%
21.10%
34.52%
27.28%
46.14%
17.67%
1993
1997
2001
2005
2009
2013
2017
White House
Senate
House of Representatives
S&P 500 Index
Communication Services
Consumer Discretionary
Consumer Staples
Energy
Financials
Health Care
Industrials
Information Technology
Materials
Real Estate
Utilities
Democrat
Democrat
Democrat
Democrat
Republican
Republican
Republican
Democrat
Republican
Republican
Republican
Republican
Democrat
Democrat
Democrat
Democrat
Democrat
Republican
Republican
Republican
Republican
33.32%
41.25%
34.34%
32.87%
25.21%
47.97%
43.72%
26.97%
28.56%
8.41%
N/A
24.68%
-11.89%
-12.24%
2.78%
-6.42%
-10.45%
-8.94%
-11.96%
-5.74%
-25.87%
3.40%
N/A
-30.40%
4.91%
-5.63%
-6.36%
3.58%
31.36%
6.47%
6.46%
2.30%
0.99%
4.39%
7.36%
16.83%
26.45%
8.93%
41.30%
14.89%
13.78%
17.15%
19.70%
20.93%
61.72%
48.58%
20.79%
11.91%
32.37%
11.47%
43.08%
26.14%
25.05%
35.59%
41.46%
40.64%
28.42%
25.60%
-1.53%
13.21%
21.82%
-1.25%
22.98%
13.49%
-1.01%
22.14%
22.08%
21.01%
38.81%
23.84%
10.85%
12.10%
10.00%
14.34%
14.64%
-3.87%
15.87%
10.59%
-8.19%
18.56%
21.71%
13.46%
N/A
13.64%
Source: Bloomberg and The Spokesman-Review. Past performance is no guarantee of future results. This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions or other
expenses incurred when investing. Investors cannot invest directly in an index. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance. The 11 major S&P 500 Sector Indices are capitalization-weighted and comprised
of S&P 500 constituents representing a specific sector.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any
other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P. | Member SIPC | Member FINRA | 1-800-621-1675 | www.ftportfolios.com
Not FDIC Insured | Not Bank Guaranteed | May Lose Value