2 ETFs Likely To Win Whether There's A Biden Or Trump Presidency

 | Nov 02, 2020 19:55

With less than 24 hours until the U.S. Presidential election begins, anticipation about the results, and the impact on the economy are in full focus.

Last week's runup in volatility in U.S. equities is only adding to the anticipation. The uncertainty surrounding the election, as well as questions regarding the global economic recovery given the upswing in COVID cases, are key factors in the rise of volatility.

Seasoned investors realize election volatility is mostly short-term noise whereas well-managed companies that produce stable revenue are likely to do well regardless of party politics.

Research released in 2018 by the Board of Governors of the Federal Reserve System examined why the S&P 500 index moved higher from the November 2016 presidential election through the end of 2017.

Economics professors Olivier Blanchard and Robert M. Solow, who led the study, agreed more clarity about economic policy helped boost the markets, explaining:

"A bit more than half of the increase in the aggregate U.S. stock prices from the presidential election to the end of 2017 can be attributed to higher actual and expected dividends. A general improvement in economic activity and a decrease in economic policy uncertainty around the world—contrary to what was forecast before the U.S. election—were the main factors behind the stock market increase."

With this in mind, here is an ETF on track to benefit over the long-term no matter the election results:

h2 SPDR S&P Internet ETF/h2
  • Current Price: $116.86
  • 52-Week Range: $53.49 - $131.56
  • Dividend Yield: 1.15%
  • Expense Ratio: 0.35%

The SPDR® S&P Internet ETF (NYSE:XWEB) provides exposure to businesses that operate in internet services, infrastructure, e-commerce and interactive media. The fund started trading in 2016 and has close to $48 million under management.