As election results started to pour in on Tuesday night, the surprise outcome of a Donald Trump victory rippled throughout international markets. U.S. stock futures fell more than 5% as the uncertainty of what was happening led to a risk-off trading environment. By noon on Wednesday, not only had markets completely recovered from those losses, but they were well on their way to strong gains.
While there are many uncertainties about our future, and questions to be answered regarding what type of leadership we can expect in the White House, the proper response to this week’s election outcome is to remain patient and remain committed to long-term goals. A great point was made in an article by Stan Choe and Ken Sweet, both AP Business Writers, “Elections can mean big short-term swings for stocks and other investments, but they historically have had minimal impact over the long term.” Remember, a well-diversified and balanced portfolio is not built on the basis that we know what will happen in the future, or that we know which way short-term volatility will swing. It’s precisely because we don’t know what will happen, that we utilize strategies which focus on maximizing long-term results that support the individual financial goals of our clients.