There’s a likelihood that Obama will raise taxes on dividends, which would make closed-end muni bond funds attractive for investors, as well.
James Altucher, managing partner at Formula Capital, is less optimistic than others about how biotechnology and health care will do under Obama. He’s also skeptical that energy will perform well, because if oil falls even further, interest in such technologies could wane.
Looking back in history, Aaron Task for the Tech Ticker says that the stock market fares better under Democratic presidents than their Republican counterparts. Among the facts he cites include:
- Since 1901, the S&P 500 rose an average of 7.2% under Democrats vs. 3.2% under Republicans, according to Ned Davis Research.
- In the last seven periods where Democrats had complete control of U.S. political power, the S&P 500 rose an average of 14.7%, according to Bespoke Investment Group.
It should be noted though that we’re in a climate not seen in decades, so only time will tell if this continues to be true for the markets.