Investors Expect Big Gains From U.S. Stocks Post-Election

Nearly 70% expect equities to return up to 10% or higher in the next year

By
Caleb Silver
Full Bio

Caleb has been the Editor-in-Chief of Investopedia since 2016. He is an award-winning media executive with more than 20 years of experience in business news, digital publishing, and documentaries. Caleb is the on the Board of Governors and Executive Committee of SABEW (Society for Advancing Business Editing & Writing), and his awards include a Peabody, EPPY, SABEW Best in Business, and two Emmy nominations.

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Published November 10, 2020

Investors were justifiably anxious about the U.S. election and Investopedia readers said it was their biggest concern, according to our pre-election surveys. But since Election Day, our readers, and many market participants, have turned notably bullish. According to our most recent survey of our readers, conducted from Nov. 4 to Nov. 9, nearly 70% expect equities to return up to 10% or higher in the next year.

Investors Favor U.S. Stocks

65% of our readers think stocks, particularly U.S. securities, will outperform other securities, including gold and Bitcoin, in the next 12 months. Behind the optimism may be the recognition that a Biden administration — if he indeed becomes the president-elect once the electoral college formally casts its votes in mid-December — and a Repubican controlled Senate — which also looks probable — will mean the status quo for stocks. 

Biden’s tax proposals on corporations and high-earning Americans may not be approved, which is a boon for U.S. companies, particularly tech companies. A sizable stimulus bill and heavy government spending are also likely, and equity markets love spending.

To be sure, our most recent survey was conducted before the positive vaccine news was released on November 9, setting off a rotational trade out of tech and stay-at-home stocks and into recovery-related sectors like travel and energy.

Still, Investopedia readers are skittish about committing new capital to equities. Nearly 70% of those who responded to the survey said they are not making any changes to their allocations given the likely results of the election. They’ve seen it all in 2020: a bear market, a recession, a raging recovery, and intense volatility amid a global pandemic. They may be spent, and who can blame them?

What Are You Reading?

But they are very curious. We monitored articles and terms on Investopedia throughout election week and through the weekend to identify those stories that drew outsized interest from our 14 million U.S. readers. Their curiosity has ranged from the impact of Biden’s proposed tax increases to how to buy Bitcoin. They are also interested in which cannabis and clean energy ETFs to buy.

2020 has stirred up investors’ animal spirits like no other year before, and there are still six weeks to go in this very interesting year.