Even though the NYSE was technically closed between 4 p.m. Tuesday and 9:30 a.m. Wednesday morning, you could have made money overnight between the time the ballot results came in and this morning's opening bell.
A lot of market activity happens after the NYSE building staff go home, and election night was no exception. As the polls results came in overnight Tuesday, Dow futures tanked 800 points in late-night futures trading, while the S&P was down 5%. As of midday Wednesday, however, both indices had stabilized to at or above Tuesday's close levels. (Related: Why Economically Stressed Voters Made Trump President)
So in other words, everyone broke even, right? Well, not exactly. Sure, if you did what I did last night (took a Benadryl at 9pm EST, fell asleep and woke up just before normal working hours), your portfolio was largely unchanged overnight because you were not awake to enter or exit positions. But what if you hadn’t had a surprise allergy attack after eating fried pollock? What if you were willing to stay up all night – not just to watch the returns come in, but also to profit from the witching hours between Trump’s victory and Wednesday’s opening bell?
Assuming that you were either prescient or had deep faith in efficient market theory, or something, you would likely have guessed – correctly – that midnight madness would stabilize the following morning, right? Which is basically what just happened.
There are a few areas where the individual investor could have made bank, in exchange for a tremendous amount of short-term anxiety:
The Mexican Peso (MXP)
Overnight, the Mexican peso went down some 13% against the US dollar – just over 20 pesos to the dollar – the biggest move in that currency pair since the “Tequila crisis” of 1995. At around 12:15 a.m., for example, which was just over an hour after the media called Florida for Trump, the peso was trading at 20.77 to the USD. Had you been awake and active, that would have been a good time to buy pesos. As of midday Wednesday, the peso has recovered to 19.74, which is nearly a 5% gain.
How could you have done that?
Currency trading is one of the most liquid markets in the world. It runs continuously from 5 p.m. EST Sunday to 4 p.m. EST Friday. And, unlike with futures, there is no limit to the size of your position. (See our helpful Forex Trading Tutorial.)
Of course, you would have to have opened an account through a reputable forex brokerage, if you didn't have one. Fortunately, you could have done this within minutes – and in real time, say at 11 p.m. last night when Florida was called for Trump. There is no commission; the brokerages make money from the bid-ask spread.
Though the official trading day ends at 4 p.m., which would have been well before the results of the presidential election were known, it is possible to do pre-market trading from 8 a.m. or even as early as 4 a.m. Some direct-access brokers can execute these types of early trades. The downside to pre-market trading, where equities are concerned, is that there is not a great deal of liquidity or trading volume, and most stocks only show stub quotes (a placeholder quote well off the stock's actual market price). For this reason, you would have been better off trading Index-based exchange-traded-funds (ETF), such as the SPDR S&P 500 ETF, which have have moving quotes due to the trading in the S&P 500 futures contracts.