What Trump’s presidency can tell us about the JSE and investor behaviour

Since Donald Trump won the 2016 presidential election in the US, the S&P 500 has enjoyed a remarkable run of gains. The index is up around 54% in just over three years.

This is not an endorsement of Donald Trump or his presidency. It is, however, an important lesson for investors.entitled Political Climate, Optimism and Investment Decisions, researchers in the US found that people’s attitude towards markets is “dynamically influenced” by their political affiliation, and who is in power.

This sentiment then feeds into their investment decisions. The more optimistic someone is about the prospects of the local economy, the more likely they are to invest and trade in the stock market. “Shifts in political climate influence people’s perceptions of risk and reward,” the paper’s authors found. “Investors believe that financial markets are less risky and more undervalued when their own party is in power. This reduced assessment of the riskiness of the market and higher potential reward induces investors whose party is in power to take greater financial risks.”How this relates to the Trump presidency should be obvious.

Source: News Formal (newsformal.com)

South Africa Latest News, South Africa Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Donald Trump boasts about US economy at Davos, ignoring impeachment trial | IOL NewsTrump tells WEF he saved the global economy from the brink of recession, rescued US manufacturing and reshaped the rules of international trade. But his economy is doing well shame, unemployment rate is very low The impeachment is a farce anyway. Not enough Dem seats to get him out.
Source: IOL - 🏆 46. / 51 Read more »

Gold eases amid concerns over coronavirus outbreakSpot gold and US gold futures drop as investors assess the risk of a global epidemic
Source: BDliveSA - 🏆 12. / 63 Read more »

MARKET WRAP: JSE falls in risk-averse trade as China virus spreadsThe JSE all share lost 1.49% , its biggest slide in more than two months, and the top 40 1.53%
Source: BDliveSA - 🏆 12. / 63 Read more »

Trump rejects impeachment charges as an affront to US ConstitutionHahahahahaha he wouldnt know the constitution if it got up and bit him.
Source: ewnupdates - 🏆 30. / 53 Read more »

Donald Trump rejects impeachment charges, calling it an affront to Constitution | IOL NewsPresident Donald Trump rejected the House of Representatives' impeachment charges, describing the allegations as affronts to the U.S. Constitution. He reminds of certain former press in this country
Source: IOL - 🏆 46. / 51 Read more »

Trump team calls impeachment articles ‘deficient and rigged’ ahead of trialTrump’s legal team says the US president was well within his constitutional authority to press Ukraine to investigate political rival Joe Biden and his son Hunter Can someone interfere in the US agendas
Source: BDliveSA - 🏆 12. / 63 Read more »