S&P 500 Returns based on the Election Cycle

I took a look at S&P 500 returns since 1950 when the following conditions are in place:

1) The second year of presidential term.

2) Democrats are in control of the Presidency and both houses of Congress.

Year Annual Total Return President
1962 -8.73% Kennedy
1966 -10.06% Johnson
1978 6.56% Carter
1994 1.31% Clinton

The average return is negative. The positive 1978 nominal return of 6.56% expressed as a real return was negative if you take inflation into account.

If history repeats, 2010 will be a relatively flat year with a slightly negative bias.


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