{"id":8999,"date":"2020-11-05T17:16:05","date_gmt":"2020-11-05T17:16:05","guid":{"rendered":"https:\/\/zackspcg.com\/blog\/?p=8999"},"modified":"2022-02-26T13:06:27","modified_gmt":"2022-02-26T13:06:27","slug":"will-market-volatility-continue-after-the-election","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/will-market-volatility-continue-after-the-election\/","title":{"rendered":"Will Market Volatility Continue After the Election?"},"content":{"rendered":"\n<p><em>Will F. from Memphis,\nTN asks: <\/em>Mitch, I\u2019m wondering if you can set some kind of expectation for the\ntype of volatility we can expect post-election. I\u2019m personally worried about how\neverything is going to shake-out in the next couple of months. <\/p>\n\n\n\n<p><strong>Mitch\u2019s Response: <\/strong><\/p>\n\n\n\n<p>Thanks for writing, Will, and I know a lot of other readers\nshare your concern. Just looking back at history, we know that\neven without worries about voting and a contested result, volatility has been\nassociated with recent elections. Looking back at the last seven U.S.\npresidential elections, the CBOE Volatility Index (VIX) has risen an average of\napproximately four points in the month leading up to election day.<sup>1<\/sup> This\nelection is obviously different.<\/p>\n\n\n\n<p>Just last week, we saw the stock market\nposting fairly pronounced up and down moves, which readers should remember is the\ndefinition of volatility. Many folks think about volatility just as downside\nmoves, but volatility works both ways. Last week, the market was dealing with a\nconfluence of earnings, economic data, fresh European economic\nrestrictions, and intensified media coverage of record Covid-19 cases and a\nsurge in hospitalizations that all hit the tape at once. <\/p>\n\n\n\n<p>_________________________________________________________________________<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/go.steadyinvestor.com\/arrow-use-volatility-to-your-advantage?source=zim&amp;medium=blog&amp;term=mitchsmailbox_zim_2020_11_5&amp;content=volatility_can_be_good_guide\">How to Use Market Volatility to Your Advantage This Election Year<\/a><\/strong><a href=\"https:\/\/go.steadyinvestor.com\/arrow-use-volatility-to-your-advantage?source=zim&amp;medium=blog&amp;term=mitchsmailbox_zim_2020_11_5&amp;content=volatility_can_be_good_guide\"><br><\/a> &nbsp;<br> We understand that downside market volatility is challenging for just about every investor, and this feeling is only heightened from the uncertainty that comes with an election year. But for all the worry and discomfort it often causes, did you know there are also several positive aspects of volatility?<br> &nbsp;<br> If you have $500,000 or more to invest, get our free guide, <em>\u201cUsing Market Volatility to Your Advantage,\u201d<\/em> and learn our insights, based on decades of experience, about how a volatile market may be able to actually help investors refine their strategies and potentially generate solid returns over time.<br> &nbsp;<br> You\u2019ll get our ideas on:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>How market volatility can \u201cshake up\u201d complacent investors<\/li><li>Potential bargains that may be uncovered through turbulence<\/li><li>Why volatility may help prevent overheating and market \u201cbubbles\u201d<\/li><li>What history shows us about opportunities for steady investors in turbulent markets<\/li><li>Plus, more ways you may be able to benefit from a volatile market<\/li><\/ul>\n\n\n\n<p><strong><a href=\"https:\/\/go.steadyinvestor.com\/arrow-use-volatility-to-your-advantage?source=zim&amp;medium=blog&amp;term=mitchsmailbox_zim_2020_11_5&amp;content=volatility_can_be_good_guide\">Download Our Guide, \u201cUsing Market Volatility to Your Advantage\u201d<\/a><sup><a href=\"https:\/\/go.steadyinvestor.com\/arrow-use-volatility-to-your-advantage?source=zim&amp;medium=blog&amp;term=mitchsmailbox_zim_2020_11_5&amp;content=volatility_can_be_good_guide\">2<\/a><\/sup><\/strong><\/p>\n\n\n\n<p>_________________________________________________________________________<\/p>\n\n\n\n<p>Even with election day behind us, I think we should\nreasonably expect volatility to continue over the next few weeks \u2013 which to me\nmeans the likelihood of investor missteps will also go up. The investment\ncommunity tends to view volatility as an opportunity to take gains off the\ntable, to trade in-and-out of stocks in an effort to \u2018buy the dip,\u2019 or in some\ncases, as a reason to avoid investing in stocks altogether. But I think these\napproaches tend to result in mistakes \u2013 which can ultimately detract from\nlong-term returns.<\/p>\n\n\n\n<p>Take the approaches of trading in-and-out of stocks to\neither generate profits or to buy stocks that have pulled back. Even though\nmarket volatility often presents itself as an opportunity to make some\nstrategic changes, investors often forget that volatility works both ways (up\nand down), is very unpredictable, and often happens in clusters. Selling\npressure one week may not mean selling pressure the next, and investors can get\ncaught waiting for a trade that never materializes.<\/p>\n\n\n\n<p>When it comes to the election results, I\nthink there is a distinct possibility that the <em>fear<\/em> of a messy outcome may very well outweigh the <em>actual risk<\/em> of some kind of political\n\u2018Armageddon.\u2019 What\u2019s more, the stock market may already be pricing-in a\ncontested result and some abnormal transfer of power. We just can\u2019t know. <\/p>\n\n\n\n<p>Rising\nvolatility coupled with a very noisy news cycle will almost certainly increase\nthe investor\u2019s desire to \u201cdo something,\u201d or to make changes or trades in\ninvestment portfolios. But doing so tends to lead to more mistakes, in my view,\nwhich can ultimately detract from long-term returns.<\/p>\n\n\n\n<p>As\nvolatility in the market continues over the next few weeks, understand that you\nhave the opportunity to make the most out of these challenging times. There are\nalso positive aspects of volatility you don\u2019t want to overlook. To give you insight into\nsome of these positives, I am offering all readers our guide \u201cUsing Market Volatility\nto Your Advantage\u201d<sup>3<\/sup>. This guide&nbsp;can help you learn about our\ninsights, based on decades of experience, about how a volatile market may be\nable to actually help investors refine their strategies and potentially\ngenerate solid returns over time.<br>\n&nbsp;<br>\nYou\u2019ll get our ideas on:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>How market volatility can \u201cshake up\u201d complacent investors<\/li><li>Potential bargains that may be uncovered through turbulence<\/li><li>Why volatility may help prevent overheating and market \u201cbubbles\u201d<\/li><li>What history shows us about opportunities for steady investors in turbulent markets<\/li><li>Plus, more ways you may be able to benefit from a volatile market<\/li><\/ul>\n\n\n\n<p>If you have $500,000 or\nmore to invest, download this free guide today by clicking on the link below.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>With this election, there is even more uncertainty than usual. Mitch discusses how investors should react. <\/p>\n","protected":false},"author":3,"featured_media":7436,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66,71],"tags":[],"class_list":["post-8999","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mitchs-mailbox","category-private-client-group"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8999","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=8999"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8999\/revisions"}],"predecessor-version":[{"id":10515,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8999\/revisions\/10515"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=8999"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=8999"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=8999"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}