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Hey, this is Sasha and thanks for joining me here for another episode of let’s talk stocks, episode number 104.
In this episode, we’re going to be discussing politics, I know, not usually the most favorite topic to consider, and there’s a lot of heat and drama behind people when you talk about politics, but our key focus today is talking about trading politics, democrats vs. republicans. And how to look at the market, trading and investing in future growth for you as well as how the economy seems when a particular party is in office.
Looking at it at the statistical probability of what’s going to happen when a certain person or leader is in power. That’s what I want to share with you today.
When you’re looking to cast your vote in the November election, there’s a lot of other factors that go with it, there’s a lot of factors, including women rights, including gun control, including terrorism, including a lot of other issues that go into casting and making a decision for your candidate or person.
We’ll focus on economics
But as far as this lesson goes, I’m going to strictly, entirely focus on the economic side of things and what the statistical probabilities are for one type of party versus another. So let that be a little note that whatever your discussion is regarding politics, as far as this video goes, we’re strictly focusing on economics, and looking at the statistical probabilities of any one type of party, not candidate-specific, but more along the lines of the party.
In this video, if you’re overseas, if you’re in another country, you could use it to get some ideas and insights about your own country and how to look at things, as new officials get elected, then you can see, how do I approach things as far as the stock market goes? How would I look at things as far as a new political person being in power or office?
This is what you could do is, I’m going to share with you some insight of the things I look at, and then more so along the lines of the statistical probabilities of what happens, and then how I set up those trades accordingly, or what I believe the market would do. That’s what we’ll cover today.
Just as a little side note, remember that this video is just strictly for educational purposes and any stocks or any ETF or the markets that we discuss is only for educational purposes, it’s not a recommendation to buy or sell any specific security, and that is simply because you might be watching this video sometime in the future.
Before we get into the lesson, I want to give you some news. The new critical charts I’m scheduling them for tomorrow, Friday or Saturday morning, they should be up and ready.
Also, the new login on Rise2Learn is up, so if you’re looking at the website, it seems a little funky, then chances are it changed so hit the F5 key on your keyboard or the refresh button, and there are my courses page for login and logout button that will appear there.
I have the options study guide, which is in progress. And the sales page also that are being worked on. So, those are some of the last few things that we need to do to wrap up the curse. If you had a chance to look at the rise2learn website, you probably noticed a few of the options mastery course starting to come up there, but of course, those are coming soon.
As far as the study guide goes, to give you guys a preview. It shows you what things are going to be in this options course. There’s drawings, diagrams, a lot of information on there that will be very powerful of an options course, and it’s going to be split up into multiple classes of course. So, that’s one next thing that I’m wrapping up, still in progress.
Also I’m looking to do some live classes soon, we’ll probably start those out just for previous members or previous people who purchased only the courses or are in the critical charts, and we’ll try some live classes at first, but it’s kind of like when you attend a dance event, and you pay your $20 to participate in a dance. The same concept, so whether it’s a yoga class or fitness class, you pay $10-$20 to attend, and you can Join the class.
We’ll probably do that, and it’ll start developing soon. And I’ll have to figure out a few webinar related things, and we’ll do a one-on-one session, and we’ll see how it goes, and if it’s okay. We can continue to evolve those and make more classes and build on that because I think the value of one-on-one sessions is compelling.
And one final thing, just some courses are being reworked, I mentioned this before, we’re going to revise a few things and add some bonuses. So the people that have already purchased the old courses, will get access to both, the old courses and the new courses, but they’re just getting a little bit of rework, a little bit more content in some areas, and again, we’re just starting with some of the basic courses like the accelerate your stock market education course, or the understanding the stock market and how it works course.
I’m going to start with that, and slowly update them to some of the new standards and some more information, make them a little more detailed, just because I’ve been seeing some things, where people have some questions, and we’ll fill in the gaps with newer versions of those.
You should do your homework
Let’s take a look at the politic side behind democrats and republicans, and I want to share with you some insights and some sources that I found, all of this is based on statistical probability, rather than just personal desire of pushing one side or the other, you should do your homework, your own research, based on who you want to elect, but again, we’re only talking politics, so this is just a small part of the bigger picture of who you want to vote for, this is just the economic side of what we’re talking about, and it’s just party-centric, rather Thant candidate-centric.
But it’ll give you some ideas of looking at statistical probabilities and looking at the numbers, because when you look at the numbers, this is really how stocks move, based on the price, based on the chance of that stock going to a certain price point or price level.
Look at things as statistical probabilities
For me, as we look at a certain price point, and we’ll take the S&P for example purposes, I like to look at things as statistical probabilities because if you look at it in a probability fashion, you’ll know what the chances are.
For example, taking the S&P, think about it, in the next let’s say six months, what is the chance of the S&P coming down to about the $400 price point? Let’s say in the next year that is the chance of that happening? Probably less than 1%, less than a tenth of 1%, at least from my point of view.
Think about it, how likely is that stock to hit $400? Which it hasn’t been since 1992, it hasn’t hit that price point since that 1992-1993 level. So what is the chance of it hitting that level? Again, the $400 level. It’s very slim.
As you start rising this bar, and you say, what about $800? I’d say that’s a little bit of a higher probability or a higher chance, so now you say, maybe it’s a 1% or 2% chance. Still not very high, but it’s still a percentage of a chance.
And as you continue to get closer, you could say that the percentage chance continues to increase, within the year, you could have or touch that price level, so as we get into 1500 within the next 12 months, what is his chance of it coming there? Let’s just through a number out there, this is hypothetical, but let’s say 7% or 10% chance that it’ll hit that 1500 level.
As you continue to raise that bar, the chance continues to increase, because there are more things in your favor, the percentage of chance, statistically probability is more favorable to hit a number, it’s more likely to happen.
In our example, as we look at presidential candidates, we look at statistical probability when we trade, so you’re always looking at your trades, whether that’s apple, whether that’s Google, whether that’s Facebook. Let’s use apple for example.
Let’s say again, we take a weekly chart frame out, and we say, what is the chance is, and let’s say I’m trading this recently. If we take a Daily or a weekly, it’s up to you. We’ll say, what is the chance of an apple hitting 60? Do you think it’ll happen in the next week?
Many people might say no, some of you may say yes, there’s a fairly good chance, because the economy, the way it’s looking, it may seem weak, but you can probably tell that it’s not a high 95% chance that it’s going to hit 60 within the next week. I’d be willing to bet on that, that there’s a 95% chance it’s not going to hit $60 in the next week.
In trading, we look for probabilities
And that is just based on previous price history, so if we know that statistics and probabilities help us determine price movement, and this is what we do in trading, we’re looking at the probability, the probability of something moving in one direction or another.
If we’ve hit, let’s say support multiple times, and it’s been bouncing there, the chance of it breaking, as it continues to move higher, becomes slimmer and slimmer. So as we get into this level, the chance of this stock to come back and break this support, becomes a little bit thinner, at least for the shorter term, at least for the next week or two.
As it comes back into it, the chance increases, your probability of it breaking increases, so this is what we do in trading, we are looking at chances, probabilities and this is what volume helps us determine, price action helps us discover, putting all these things together, the higher the probability or the chance, the more likely your trade will work out in your favor, that’s ultimately what we do.
When it comes to politics, this same thing happens; you’re looking at the system of what is the chance or the likelihood of something working out.
Looking at a website, and I had to do some digging for this, and I’ll share it with you, you, of course, need to do your research, but this website seems to be more statistically oriented, I do think it is slightly democratic based, so if you look at it right here, and we click this banner, you can see it is democratically based, but going through it, and doing some due diligence, I did double check a few of these things, I’d say probably about 30% to 50% of the stuff I did double check, I didn’t double check everything after that, because the numbers seemed to be on the part of where they’re getting them from. You’ll see some of things as we go through this fairly quickly here.
Democrats vs. Republicans
As we go through it, and you look at the statistics, the probability statistics, and again, we’re only talking economically. Still, this is strictly economics based, as far as Democrats versus the Republicans, 9 of the last ten recessions have occurred under Republican presidents. Democratic presidents create nearly twice as many jobs per year as Republican presidents, and this is again based on statistics.
You can go through this website, its presidentialdata.org, and you can go through it and look through these different charts, and when you click these charts, it opens up some of this data, regarding each president. Democrat, Republican.
Don’t believe everything you read
I didn’t think this data, because you can’t believe everything you read online, you need to do your homework, but I’ll show you here where we get to and where you can backcheck some of this stuff.
Looking at it, as far as GDP growth, Democrats, of course, are going to give you a better GDP versus Republicans. Business investments again, Democrats over Republicans and budget deficit, republicans do tend to spend more than Democrats, and there for the budget deficit as you can see is there skewed in worse light for the Republicans.
You can read a little more about this data, how it was compiled and just some footnotes and just some other stats, regarding, since World War I almost twice as many jobs are created per year under Democratic presidents than Republican presidents, about 1.9 million jobs under Democratic presidents, versus 1 million jobs under Republican presidents.
If you’re choosing a candidate based on job creation, or you don’t have a job right now, and you’re looking at a Republican president, the numbers, the probabilities are not in your favor.
The same thing goes with the GDP growth, 44% higher under Democrats, business investment growth, again 165% higher under Democratic presidents, and unemployment has been 18% higher under Republicans. So more people are out of work under the Republican presidents. Statistically again, these are all statistics.
Where can you do your due diligence? And I had to do this because I looked at this and I said, this could be biased because it’s 21st-century democrats website. So I had to do some research. They mention some of the sources, and if you go to the sources, which is the national bureau of economic analysis and you do your due diligence and homework, here is the recession facts. “Contractions (recessions) start at the peak of a business cycle and end at the trough.”
Growth in stock market returns
You can do your due diligence and research based on the statistics, again, if you go through this and you look through this, you can also get to this little stock market level, the stock market under Democratic presidents has grown 200% faster under democratic than republic presidents, average yearly growth in the stock market returns under Democratic presidents is 1.92 annual average increase in the stock market returns under Republican presidents is 0.64.
If you take a look at this, again, here’s another source, the new york times, we had to double check this, so I went ahead and I looked at some of these and after about 15 of them, I said, yeah they are on part, so I didn’t double check every single one of them, but the stats were on part, new york times you would say is a credible source, and this is an older article, from 2012, so it makes sense that they would’ve fixed it by now if it was incorrect.
You can see here the growth in the stock market return based on the different presidents and how they did, so after you do the calculations, there are your numbers, and again, if you need to do some more due diligence, take a look at the statistical abstract of the united states, there are the reports, and that can be found right here, United States census bureau, so if you look at the statistical abstract of the united states, go through the documents, you can also do your homework.
Democrat presidents do better economically speaking
Again, I’m just strictly saying statistical probabilities, I know there are some people that are going to be in love with Trump, and some people will be in love with Hillary Clinton. So looking at the numbers, as far as economics go, democratically, you’re better off economically. So when you have a Democrat, typically economically you are better off.
That is if you look through the numbers, go through it, then, by all means, do your homework and do your due diligence, but this was compiled. It seemed to be the most number based driven website.
Again, you can do your homework, go through the different presidents and go through the historical prices while those presidents were in office. So you could go ahead and break these things apart, breaking the S&P saying, during Bill Clinton’s time frame, I think it’s around 1991 to about 2000 you can see the growth; you can see the acceleration of that growth within the market.
Some of this is, of course, related to a technological boom and things like that, so there are market conditions also that are at work, but in general, you can see by the numbers, the Democrats do win out over the Republicans.
Trump and Clinton’s economic plans
I took a moment to look at this and kind of think about it for a minute, and wonder, well why is that? I mean, shouldn’t Republicans also do an excellent job with the economy? What are the main differences? And just comparing the recent two candidates that we currently have, here’s what I’ll do and give you a quick little break down of their economic plan.
Some people say, Trump doesn’t have an economic plan, and others say Hillary Clinton’s financial plan is not good. So what I want to do is share with you some insight regarding the basic idea of democrats and republicans and how the plan works out in the history within the economics world.
Strictly based on the economics, we’re only covering economics, whether you think one person is corrupt or another, it doesn’t matter; I’m strictly talking about economics.
The Republican side
If we take a look at Republicans or looking at Trump, for example, they typically have a big business approach. So if we look at it, it’s a big business approach that then filters down towards the little people.
From the big business approach, what we do is we take tax breaks, we make the tax cuts for the big businesses, we want to keep those jobs here, so big business filters down to the management, comes down to senior management, then we get into hiring more people, so we hire more people because it trickles down, when we get the tax cuts in general for a big business, senior executives and management then has more money, then they hire more people, because they understand the tax breaks for hiring people and so on, and that allows their business to grow.
That’s a base idea, and it’s not perfect, it’s just a general idea or concept regarding the plan, on the Republican side, that’s the way they focus on things.
The Democrat side
On the Democrat side, in general, with Clinton’s plan here, again, baseline, everything is just simplified, we’re looking at building a skillset, and then this filters up to getting good schooling, which later eventually gets you the job, and then that gets you to a more significant business or growth for a company, you can create your own company and so on, or get into the senior management.
Here you’re looking at building a foundation first, bottom up, and here you’re starting from the top and going down. That’s the baseline between the two different parties. When I look at this, you start looking at the different types of people that look at the success and the way the world operates.
The quick vs. the slow approach
So here on the Republican side, I’m generalizing that in general, this is a quick approach, so they’re looking for quick resolves or a quick approach, and the reason I say that, is because the minute you do the tax cuts or breaks, all of a sudden this trickles down very fast, and it’s a lot quicker than this approach.
This approach is more of a slow approach, but it helps in the long run. So it’s more of a long-term view. For example, if it takes you 10+ years to get a skill or 5 years, maybe you go five years to school, so it’s a longer-term plan in general, for some people it's perhaps a 3-5 year deal here, and then it trickles up in that way.
Whereas here, in this approach, this could happen within less than 1 to 2 years, once the tax breaks are there, within one to two years you can see results. Unfortunately, some of the issues go along the lines with both of them.
If you go with a democratic plan, it’s a lot slower, it’s slower but sustainable for the longer term, so if you have a longer-term vision and you’re looking to build the foundation skillset that now you can use for the rest of your life, this is a better approach.
If you’re frustrated with your job, with no having a job, this is a quicker approach, because now the senior executive, senior management is going to be able to hire more people, allowing more people to come into the businesses.
The issues come along the lines with this big business approach, there are a few other issues, and that is simply due to slippage cost, as you go through one level, second level, third level, it’s far away from you.
When you’re looking at hiring more people, or more importantly, if that’s you, it’s far away from you, so as it affects from big business, it’s further away from you, the distance of it being a direct impact, is far.
Whereas here, this is a direct impact on you, this is all focused on you, it’s all about you because you build your skillsets, you go to school, you get a job, and then you create your big business, or you get into it as a senior executive position. And when you have this approach, there’s a lot of slippage cost that happens.
You might be wondering, what does slippage cost? Slippage cost usually is a finance term, but in general, I’ll give you a little idea.
Let’s say I’m on eBay, I’m looking to buy a camera for let’s say $1000, and I bought that camera, and now I want to change it out for another camera, but I can only get about $950 for it now, because there are shipping costs, transaction costs with PayPal, listing costs, so I can just get $950.
Then I go ahead and buy another camera, I don’t like that camera, and let’s say it was for the same price, now all of a sudden, again, let’s say I want to resell that one, I can only get $950. So between the two of these, I lost $100.
If you do this a handful of times, eventually you’re down at a $500 or $1000 loss, and you pretty much could’ve wasted the whole amount that you spent on the camera. So you could be left with no camera, and you lost a $1000, due to the slippage cost that you’re missing between fees, and your own time and energy.
When we look at big business here in this case, you can see that throughout these different levels, what’s going to happen is, the big companies are going to get those tax cuts, which is in theory pretty good, they get to pocket more money, and they can also use that to grow their business which could lead to hiring more people.
Unfortunately you start losing at every level, and that’s really where the problem stands, but you do get a quicker results often, because once the tax cuts happen, they’re really fast, and they can go ahead and implement those very quickly, so for that one to two years it works out fine and fantastic.
But unfortunately for the longer term, as those things add up, as hiring more and more people becomes more expensive, you get back to cutting the jobs to reduce expenses because the senior management wants to keep more of that money, it’s just natural, they always look at themselves first, right? So when you’re looking at somebody in a senior executive management position, they still look at, first themselves, then maybe they’re looking at their job, and then the third and final thing could be perhaps you if you’re part of their customer. But again, number one is always going to be them.
People want fast results
In a democratic approach, it’s you building the skillset, but the disadvantage, the major problem is the skillsets that you have to develop, which takes time, for many people don’t want to go to school, they don’t’ want to learn the skills, they just want the job, they want the fast results, and get their money and their pay.
So if you build the skillset and you have the foundation, you’ll be better off in the long run, but unfortunately, the time and effort to get this skillset is a lot more work.
Which one is better? Well, it depends on your outlook and how do you invest? Again, it depends on your outlook, and it comes down to psychology. So I start wondering why do people vote for a democrat or a republican?
Why do people vote for their party?
If we look at the overall market, and now we’re looking at, currently we’re in a democratic state. Later we’ll look at republican, meaning the president is democratic or republican.
If right now we're in a democratic based economy, we’re doing, let’s say, taking the statistics off the sheet there, 1.92%
And then, we move into a Republican based, why does this happen? And we get to, let’s say only .64% growth on the economy.
Some people’s justification, they say, if we were in a democratic based presidential cycle right now, and now we vote Republican, even though statistically we know we’re going to get less growth, why is it that this happens? If again, we’re just looking at economics.
Well, there’s going to be a lot of people that say, “I didn’t make it,” they’re looking at themselves, “I didn’t make that 1.92% or 5% or 2%”, whatever the economy was, “I’m not in a better situation.” A lot of it is “I focused,” it’s not enough compared to other people. So they’ll start comparing themselves, so it might be it’s not enough. This is a quick basic idea, and this is what people could be saying to themselves.
If we’re looking at a republican timeframe, so let’s say we’re at .64% growth, and we’re going into a Democrat, and a Democrat wins, and now we get into the 1.92% on the economy, or stock market growth.
Why would we go from a republican to a democrat? Well, it could be that there are some people that are thinking, “it could be better. I could’ve done better”. It could be more along the lines of that “we did better in the past with somebody else.” So you get this cycle effect with people, that over here “it’s not enough,” and over here “it was better before.”
It just goes back and forth, back and forth, back and forth, but really when you look at the numbers and when you look at it statistically, the Democrats typically do a better job under the financial world, or in the economic sense.
There are a lot of factors influencing your vote
In reality, in a big picture sense, there are a lot more factors to consider than just economics, so I fully understand that, there’s going to be a lot of other things that you’ll be feeling, about how honest, dishonest one person is, about terrorism, global issues and just a lot of other factors to consider before voting for a candidate, but when we look at the stock market, and we look at economics, how would you position yourself with one candidate versus another?
And this is really where I start looking at things now on my portfolio, and if you’re I another country, whether that’s Canada or Europe, whether that’s the united kingdom, you’re going to start looking at these things and seeing how these things start affecting the economy, and for me, as I look at this, and as I start looking at the charts here and we get into it, I’m going to look at it and say, where is my risk? What’s my problem?
Look at the overall market first
If we look at this S&P, I look at the overall market itself first, so looking at the selection and what to do between each candidate, I’m looking at the overall market, how it’s doing and the health of the overall economy.
Right now we’re really at a very toppy point, so do I expect the pullback? Yes, I do, I expect the pullback regardless of which candidate comes into office.
The difference is, I expect a larger pullback when a republican is in office, and that is simply just due to statistics, due to the probabilities that we talked about.
When looking at this chart, when looking at these kinds of things and issues within the market, as far as the support, the resistance, the way the market’s moving, behaving, I’m already looking for a pullback, but as we get closer to the election, what I do is become a little more cautious.
If things look like they’re going to sway or if a republican gets into office, I’m looking for the market to either not go up as much, or even pull back slightly.
Here’s what’s going to happen. So for example, if we take for example Hillary Clinton getting into office, I might still expect a pullback, and I might expect that pullback to come down to, let’s say 1795 level. It could even get down to the 1500 level if it’s a longer-term view, but I’m looking for 1795 level for a pullback, 1800 would be my support level. I think the market’s already quite high, so I would expect the pullback, regardless of what candidate is in office. So if Hillary gets elected, 1800 would be the line on the sand.
If Trump gets elected, I would say the pullback would be more along the lines of 1500, so I’m basically budgeting a further move pullback, simply because of what history has told me, if you’ve learned and study history, statistics, and probabilities, you’ll see that the probabilities are not in my favor if Trump gets elected, as far as the market moving higher. Whereas now as the market holding its ground, the market holds in better during a democratic cycle, since the 1940s that’s what it’s proved to be, so that’s what I would expect. And that is just merely based on the numbers.
The way you position for this is, it’s not going to happen really quick, so let’s just say, tomorrow is the election, it’s not all of a sudden Trump gets elected it’s going to go down to 2120 or even 2000, the same thing with Hillary Clinton, it’s not going o happen in that way, at least I’ve never seen it or heard of it happening that way.
Instead what people will do is slowly shift their positions, just like they rotate their postings are news break out, like Brexit and things like that, so they are already rotating and budgeting their jobs over the next six months, year, over the next 2-3 years. That’s what they’ll do, they’ll rotate positions, and they might expect more or less of growth, depending on the candidate.
As far as your positions, and as far as your account and portfolio, if you’re a long-only trader, this is not the best scenario if Trump is elected. However, if you’re selling premium, option volatility it’s fantastic because you can sell more volatility, because the market will go a little bit crazier, as far as what the numbers have told us.
For those of you who like trading short, you probably want Trump to be elected. If you like selling premium, you want more volatility, and if you’re a day trader, you probably want Trump.
If you’re more of a long trader, long-term position holder, looking to invest in company growth, then you probably want Hillary Clinton to be the next president.
Again, those are some things to look at, and once the election happens, you want to do it carefully and slowly making those adjustments to your positions, because you see by the statistics, and again, you can do your research and homework, but in general, based on the statistics, that the market will grow slower under a Republican nominee.
There’s one last little point I want to make, and that is, who wins? Or who’s going to benefit? Who’s going to benefit from these candidates? And again, strictly looking at economics, and looking at the economy.
If we look at Trump vs. Clinton, who’s Trump going after? Or who’s he listening to help out? Well, his key focus is big business. So he’s looking at big business, that’s his key focus, and then eventually he thinks that this will come down and trickle down to the little guy. Remember what I said about slippage cost, there’s slippage cost that’s going to be involved.
Here on Clinton side, who’s her core focus? It’s the little guy or the little person. So she’s looking for you to build the foundation, whether that’s schooling, whether that’s your skillsets, and then that eventually trickles to the upside. Doesn’t always get to the big businesses.
Here on the Trump side, we get tax cuts for big businesses, which then lets them hire more people like you.
Going against gravity is very difficult
That’s what they’re hoping for. Remember with these senior executives taking cuts within these timeframes, by the time it gets to you, it’s a tiny fraction, it does happen, but remember, it’s a trickle-down effect, so you have to go through multiple stages and multiple levels.
Here on this side, the problem with this is that you have to go up, and going up against gravity is tough, and many people don’t want to do it, they want the quick result because this is quicker.
This is slower. This is better long-term, so when you look at longer term, this is better. If you’re looking at the shorter term, this is better.
It all comes down to what you look at
It really comes down to what you’re looking at, if you’re a person who looks long term, you’re looking for slower growth, but you want sustainability, this is a better approach, because you’re doing skillset, they’re helping the little person, because the taxes get raised just like in Canada. Taxes are high for big business and senior executives. They already have plenty of money.
And with Trump, they think that when you have those Tax cuts for the big businesses it trickles down, and it does happen to some degree.
With Clinton, if you raise the taxes, it thinks it’ll slow down the growth for big businesses hiring, which it does, it does slow it down, but you also have to build the foundation of the little person, so her energy is focused on the colleges, giving back to the schooling and getting people the right skillsets so that they can go and get their job.
It’s a weird dynamic between both of these candidates, but ultimately, economically and statistically, the Democrats are typically more favorable when it comes to economic growth and economic situations.
There are my thoughts and insights regarding the two different party systems, we’re more or less honing in on statistical economic data, based on the parties and how they performed over the last 60 to 80 years.
What should you do?
If you need to do your research, go to the census bureau, do the statistical analysis, do your data, your homework, and compare on the charts.
What’s the key plan? What’s the key focus for you to do? Well, looking at statistics, I’m always looking at probability, I’m looking at if a Democrat gets elected, and I’m still looking for a pullback just based on current economic situations, the economy will pullback, but maybe not as heavy.
If a republican gets elected, it’s going to pullback a little heavier than it would on a Democrat, that’s the way I look at it, and that way my position slowly gets shifted as a new official gets elected, because they still haven takes office yet, it takes time for them to take office, they might have won the election, but it’s only when the transition starts to happen.
And that’s what starts to happen in trading, at least for me, is that I’ll begin to adjusting my positions slightly based on the risk that we have available, and that’s the way I look at it from an economic standpoint.
Of course if you’re doing an election and you’re choosing your candidate, there’s more to it than just choosing based on economics but if economics is a big thing for you, then, of course, you want to look at your numbers and do your due diligence, but yes, there are other things in place, other issues involved, between the war, the expanding, the deficits, between women rights and all kind of different things. There’s a lot of issues out there with guns and this and that.
You need to go out and do your homework, do your due diligence as far as the election goes, but as far as trading, the economy, I look at the statistics, what has happened in the past, what has been the probabilities in the past, and what’s my probability of the market working out in my favor.
If I have a 90% chance of a pullback in a certain stock, then that’s a pretty high change or pretty high odds, so I might want to get rid of the position.
The same thing here, if you’re looking at the different statistical probabilities as far as the election goes, even if you vote for a certain candidate or another candidate, it comes down to how do you then treat your investments?
Maybe the other issues are more important to you than economics, so in that case, vote based on those issues.
In either case, that’s just my thoughts regarding the political, economic situation and how things really pan out for the different parties and it’s really just looking at the numbers, at the statistics, you, of course, should do your homework, do your research and that way you can go ahead and make our own logical decision for who you’re going to vote for.
If you’re in another country, do this
But if you’re in another country and you’re looking, and you have a new party person coming in, then again, you might want to do something like this along with the lines, figuring out, which candidate typically has better statistical performance, because then you have those odds in your favor.
Or at least then you know a picture of what’s going to happen, and if not, if the economy is not a big issue for you, as far as choosing a political leader, maybe it’s all about war, or perhaps it’s all about really healthcare, in that case, then you make your decision, but then you might do something a little different with your investment portfolio, because you’re still looking at your investments, how they do, how they perform.