| Don’t Let This Post-Election Market Shock Blindside You Editor’s note: I mentioned in Thursday’s Power Trends how my fellow quant analyst Louis Navellier predicted earlier this year that Joe Biden would not be the Democratic nominee for president.
I was a little skeptical, I admit. But he was right.
Louis knows his stuff, which is why we’ve bonded through the years. He’s not alone in thinking chaos could grip the nation – and the stock market – in the days and weeks following the election.
That’s why he’s hosting “The Day After Summit” just days before that chaos hits, on Tuesday, October 29, at 7 p.m. Eastern Time. Reserve your spot for that presentation by going here.
That shouldn’t scare us. Chaos can lead to some of the best opportunities for smart investors who are prepared. I intend to use any volatility as a chance to buy the highest quality stocks in the market at discounted prices for what looks like a sizzling rally in the months ahead.
Today, I wanted you to read more from Louis on his prediction… why you can’t let the chaos scare you… and how you can profit from it. |
“The enemy within”… That’s how Donald Trump describes his political opponents in the Democratic Party. And Kamala Harris has warned her supporters that a second Trump term would be a “huge risk for America.” Each side doesn’t just see each other as the wrong choice for the country. They see each other as an existential risk to what it means to be an American. If you think this year’s election will be settled on November 5, I have a bridge to sell you. Instead, I predict we’ll see another hotly contested election – after the votes are cast. Don’t just take my word for it… During a panel discussion in Singapore last Friday, billionaire investor Ray Dalio expressed his concerns about the orderly transition of power. If it’s a close loss for Trump, Dalio predicted it was “almost an even probability” that he would contest the results. And if Harris loses in a close race, the Democrats won’t play nice, either. In their minds, there’s too much at stake. And as investors, we need to be paying attention. It could cause chaos in the stock market. The Bigger the Moves, the Bigger the Profits You see, the effects of a contested election won’t just be felt in Washington D.C, but also on Wall Street. I believe the market’s "fear gauge," the VIX, could double or even triple as the stock market whipsaws in the days and weeks following the election. That may sound scary – especially if you’re new to investing. But for professional investors (like Jason and me), these are the times when you stand to make some of the biggest gains of your career. Simply put, the bigger the moves we see in stocks, the bigger the opportunities there will be to profit. And if you prepare for the volatility that’s possibly coming, you’ll not only avoid the losses triggered by the market reaction… But you’ll also have the rare chance to triple your money or more in a matter of weeks. I’ll show you how in just a moment. First, though, let’s look at what happened to the stock market the last time there was a prolonged legal battle following a closely contested election – back in 2000. 35 Days of Uncertainty Of the more than 100 million ballots cast, the 2000 presidential election was decided by 537 votes in Florida. If you’re above a certain age, you’ll no doubt remember what happened. Back then, many voters used punch-card ballots. And in some cases, the punched-out pieces of paper, called chads, didn’t fully detach, leaving “hanging chads.” These incomplete punches made it unclear whether the voter had chosen a candidate or not, which led to disputes over how to count those ballots. Long story short, the results were contested. Recounts were ordered, debated, challenged, halted, restarted, and challenged again. The election was settled only 35 days later when the Supreme Court declared George W. Bush the winner. This wasn’t only unsetting for millions of Americans. It also seriously upset investors. In the week of the election, the S&P 500 was down 4.3%. The average weekly drawdown for the S&P 500 is about 0.5%. So, we’re talking about a move 10 times steeper than the typical weekly loss. Then, in the week of the Supreme Court’s decision, the S&P 500 dropped another 4.9%. You can see the election 2000 chaos in the chart below. 
And that election wasn’t nearly as heated as this year’s contest between Trump and Harris. So, I expect any market chaos in November 2024 could make the chaos of November 2000 look mild by comparison. In fact, I think it could be unlike anything we’ve seen before. That’s because of a second event that impacts markets – right as investors are trying to cope with a contested election. This Will Send Volatility Even Higher During the same week as Election Day, the Federal Open Market Committee will meet in Washington to decide on interest rates. Most folks didn’t pay much attention. But months ago, the Fed made an unusual shift in its meeting schedule. It pushed the start of next month’s two-day interest rate policy meeting from November 5 to November 6. Why? Maybe they didn’t want to seem political… Or maybe they wanted the option to be able to react after the election results start rolling in… I’ll let you make up your mind up about that. But either way, come November 7, at 2 p.m. Eastern Time, the Fed will announce to the world whether it’s going to continue to cut key interest rates… and by how much. Right now, markets are expecting a quarter-point cut. But it could be another half-point cut like the one it announced in September. Or it could not touch rates at all. Either way, that’s three more market-moving variables that will be uncertain come the day after the election. In normal times, Fed decisions are big market drivers… But on the day after the most contentious presidential election in modern history… with the entire country on edge? Think how much more volatility it could add to the stock market. But as I mentioned up top, this is NOT a reason to panic. Quite the opposite, in fact. Systems Are Critical During Chaos I’m what’s known on Wall Street as a “quant.” Like Jason, I don’t follow hunches about what stocks to buy… or what the market will do next. Instead, we build computer models that identify stocks with high growth rates and momentum. We’ve done pretty well by taking emotion out of the investing process and trusting in our models instead… I’ve been using my proprietary quant system to help identify growth stocks and market trends for well over 40 years. It’s why I was able to beat the S&P 500 by 3-to-1 for 23 years straight. During that time, I spotted early investments in companies that dominated their industries – like Microsoft Corp. (MSFT) at $0.38, Apple (AAPL) at $0.37, and Nvidia (NVDA) at less than a quarter – all before they experienced explosive growth. Of course, that’s “ancient history.” I have many more recent successes. Just in the past year, I’ve closed out trades in Rambus (RMBS) for 133% gains in 17 months. And Gatos Silver (GATO) for 45.6% gains in one month. And if investors panic following the election as stock market volatility kicks up, I’ll be using these models to spot profit opportunities amid the chaos. (As will Jason.) From four decades of professional experience, I can tell you that systems are critical – especially in volatile markets like I see coming. And right now, I’m particularly excited about one model in particular… It took hundreds of thousands of dollars to develop. And up to recently, it’s been directly accessible only to large institutional investors and money managers for high-net-worth clients. But I’m bringing it to everyday investors like you before Election Day… to target the biggest profit opportunities that most investors can’t see ahead of time. I won’t go into too many details here. I’ll be revealing all during my “Day After Summit” on Tuesday, October 29, at 7 p.m. Eastern Time. I’ll be showing folks how to navigate the volatility I see coming and turn it into profits by using this same system. I’ll even give away a post-election trade for free. It’s designed to pay off no matter who wins the election. So, make sure to sign up for that at this link. And if you don’t have time to join me next week, don’t worry. As long as you don’t panic sell out of your long-term holdings as the market whipsaws, you’ll do just fine. Eventually… Sincerely, Louis Navellier
Senior Analyst, InvestorPlace
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