Winter 2023 Investor Letter: Markets Like Presidential Election Years

Insights | Winter 2023 Investor Letter: Markets Like Presidential Election Years
Winter 2023 Cover

Author: David I. Templeton, CFA, Principal and Portfolio Manager

Historically, equity markets have mostly generated favorable returns in presidential election years and 2024 is such a year. Investors experienced difficult returns in 2022 if they held most anything but cash. Exiting 2022 our firm had a positive view on the markets for 2023. In our Winter 2022 Investor Letter from one year ago, we highlighted the fact the Federal Reserve’s numerous interest rate increases and consequent equity market correction likely created a buying opportunity for investors. In our Winter 2020 Investor Letter we wrote how the COVID pandemic might just lead to a roaring 20’s type market environment, like the market after the Spanish flu pandemic. So here we are today looking back at 2023 and stocks around the world have mostly generated strong returns. A clear standout in return is the Nasdaq Composite Index, heavily weighted in the Magnificent Seven stocks. The three sectors of the Nasdaq Composite Index where these seven stocks reside, account for over 76% of the index.

More detail on the narrowness of the market in 2023 and our thoughts on potential investment opportunities in the year ahead are found in our Winter 2023 Investor Letter.


HORAN Capital Advisors, LLC is an SEC registered investment advisor. The information herein has been obtained from sources believed to be reliable but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results. Market conditions can vary widely over time and there is always the potential of losing money when investing in securities. HCA and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only and is not intended to provide and should not be relied on for tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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