Are Republicans or Democrats better investors in stocks? It is always a matter of debate in the market and the answer is not as simple as you’d think. Both parties have held a position on the US presidency for about forty years.
According to the previous stats, the Democrats have achieved the compounded rate of 8.9 percent in stocks which is much more than that of the Republicans. It has been estimated that the 30s crash under Hoover was a big setback for Republican reign and it is the biggest factor for the stock market to consider them behind the Democrats. The theoretical statement for investment would have made it three times the original investment under the Democratic rule which won’t even reach the half of it for Republicans (excluding Hoover Back in this aspect). Hence, in general terms, Democrats have given more in terms of stock investments and consequently, have invested higher than Republicans.
Whenever any statement is given for two aspects, there are many factors to consider in the production of market returns. You can’t ignore the previous facts as they are important to determine the popularity of Democrats or Republicans. The research also suggests that GDP growth by the Republicans was 1.6% in contrast to the Democratic presidents producing a 5.4% GDP which is quite higher with respect to the other side.
It has been found that the Democrats as Presidents have a correlation with the huge market returns. Although many researchers condemn it and mark it as a biased approach these allegations are rejected by the Democrats. There have been positive returns of the stocks under Democratic presidents. The present President of the US, Donald Trump, is a Republican but it doesn’t mean that there is less scope for growth of the stocks. Precisely in the terms of penny stocks, there are many options arising for the new companies in pharmaceutical or other segments. It might give a better scope for the Republicans to show their progressive stock market approach and trust the novel organizations. The occupational choices are variable and the presidential elections in the recent phase have given a hope to many investors for bringing out something great for the penny stock market.
Republicans have been a choice of the people during boom times (low risk) and Democrats are recommended during the economic crises (high risk). The stock dealing capacity of the Democrats has been higher than the Republicans but we can’t deny the fact that the new policies by the Republican President are leading towards a change in the party and there might be newer prospects arising for the investors.
The major economic crashes in the year 1929 (Herbert Hoover) and 2008 (George W. Bush) were held during the phase of a Republican administration. In both the cases, the crash was followed by a Democrat President (Franklin Roosevelt after Herbert Hoover & Barack Obama after George W. Bush). The economic recovery was anticipated with the assistance of these State Heads. It could be considered as a coincidence that Democrats were elected after the economic instability and the times changed due to the recovery of that phase.
Whatever may be the case, the returns were higher during the timeframe of Democrats and they’ve been considered to be successful in the stock market. Subsequently, the investments made by people were higher in their regime due to economic stability in the market. The researchers also illustrated that it was not about the strength of Democratic presidents only to get the better economy for the country but the voters, by chance, elected them when the economy was about to rebound. So, it is a matter of luck for the Democrats to hold the office in a positive phase.
There are many political correlations associated with some nations in the world on the stock markets. The stock market doesn’t get affected by the political background of the countries like Australia, France, UK, Canada or Germany; but the US market does have an impact for the same. The changes in political power are correlated with the local stock market variable fortunes in the US. The ruling party of the government (Democratic or Republican) do influence the stock market returns. The history reveals that there have been variations in the thought process of these parties in terms of the ruling segment.
American politics is different from rest of the world and there are differences between the thoughts of the parties. Hence, the presidential elections make it a point for the penny stock investors to look for the prospective results. The complicating factors of different political systems reveal the strength and shortcoming of the respective parties.
The approximate stats given by Stock Traders estimated that $10,000 investment in Democratic Reign would reach to $280,000 after 48 years and the same amount would reach $78,000 during 58 years of Republican regime. These are just the approximate values but democratic government is still preferred over the Republicans for investment.
Penny Stock Investments
Penny Stocks are unpredictable but people are tempted to include them in their investment portfolio to get a number of stocks with a limited budget. It might be about trusting a new company or investing in a weak group. The stock market performance does have influence by the ruling political parties. The numbers might be real but it again matters on the variable state laws and regulations declared at a particular phase, to determine the relation between the stock market and presidency.
Investor’s Approach: The best thing an investor can do is to wait and watch. As the time passes, there will be a change in the administrations and more studies will be done for Republican or Democratic status on investment. There have been many plans initiated for a significant chance of achievement of your goals. Many people have interest in stocks and not the politics and for such cases, there will be only the analysis of the current market, new policies and the futuristic approach that will matter.