Finally. Today is Election Day and heading into this historic occasion, polls reveal a healthy lead for Democratic nominee Hillary Clinton.
Should the former New York senator and secretary of state emerge victorious, that is widely believed to be good for equities, with the possible exception of the healthcare sector, which has languished this year on the back of harsh rhetoric from Clinton regarding high drug prices.
Still, there are other regions, sectors and asset classes that are believed to be beneficiaries of a Clinton victory. Democratic presidential nominee Hillary Clinton and Republican presidential nominee Donald Trump may diverge on many hot topics, but the two both agree on ramping up fiscal spending to restore the country’s aging infrastructure. No matter who comes out ahead on election day, investors may be win with infrastructure-related exchange traded funds.
Popular infrastructure ETFs include the iShares Global Infrastructure ETF (NYSEArca: IGF), SPDR FTSE/Macquarie Global Infrastructure (NYSEArca: GII) and the Guggenheim High Income Infrastructure ETF (NYSEArca: GHII).
Specific to Clinton winning, some possible ETF beneficiaries include alternative energy funds such as the Guggenheim Solar ETF (NYSEArca: TAN), which tracks global solar photovoltaic panel producers. Clinton has said she’d like to see 500 million solar panels installed by 2020.
[related_stories]Conversely, the Consumer Staples Select SPDR (NYSEArca: XLP), the largest consumer staples exchange traded fund, could be crimped by a Clinton victory.
“Clinton is anti-sugar and anti-tobacco. This is potentially bad news for companies like The Coca-Cola Company (KO), Pepsico, Inc. (PEP), Altria Group, Inc. (MO), Reynolds American Inc. (RAI), and Philip Morris International, Inc. (PM). That said, these are all well-capitalized companies that are diversified and potential of inorganic growth, which can then allow them to find new revenue streams that aren’t impacted by new government policies,” according to Investopedia.
Amid fears of rising interest rates and concerns that the sector is overvalued even relative to its lofty historical norms, the consumer staples group has recently encountered some headwinds.
SEE MORE: Infrastructure ETFs Win No Matter Who Wins Presidency
Defensive sectors often trade at premium valuations relative to the broader market and that is certainly the case at the moment with the consumer staples and utilities groups.
“If you want to keep the Clinton trade as simple as possible, then consider doing further research on long clean energy, short biotech, and steering clear of soda and tobacco. You generally don’t want to short sugar and tobacco,” notes Investopedia.
For more information on the consumer staples sector, visit our consumer staples category.