It's no secret that the market has been ripping post election.  SPY (the SPDR S&P 500 ETF) is up more than 28% since election day and our president certainly does not shy away from taking credit for this upswing despite evidence that presidents have little influence over the economy, especially in the short run[1].

But let's assume for a second that presidents and their policies are able to meaningfully influence the market and the economy.  Where would President Trump rank?

Well, that depends on how we measure market gains.  Trump is certainly off to a hot start.  In fact, the annualized real S&P 500 return under Trump since his election is currently the second highest of all-time, trailing only Calvin Coolidge over the period we studied (1871 onward).

Data source: Shiller data library. Calculations by Newfound Research. Monthly data used for calculations. Returns are inflation-adjusted and include the reinvestment of dividends. Returns are measured from the month of a President's election to the month of the next election in which a different president is elected.

However, when we turn from annualized return to total return, Trump still has a lot of work left to do (as we'd expect after less than a year in office).

Data source: Shiller data library. Calculations by Newfound Research. Monthly data used for calculations. Returns are inflation-adjusted and include the reinvestment of dividends. Returns are measured from the month of a President's election to the month of the next election in which a different president is elected.

He currently ranks 16th out of 27.  A couple of interesting tidbits:

  • During the period studied, in only four cases was a dollar invested at the time of a president's election worth less than a dollar by the time his successor was elected or otherwise entered office.  These four presidents are Richard Nixon, Woodrow Wilson, George W. Bush, and Herbert Hoover.
  • On the other hand, seven presidents saw the market at least double (including dividends and inflation): Calvin Coolidge, Bill Clinton, Dwight Eisenhower, Franklin Roosevelt, Barack Obama, Rutherford Hayes, and William McKinley.

 

[1] http://www.nber.org/papers/w20324.pdf

 

Justin is a Managing Director and Portfolio Manager at Newfound Research, a quantitative asset manager offering a suite of separately managed accounts and mutual funds. At Newfound, Justin is responsible for portfolio management, investment research, strategy development, and communication of the firm's views to clients.

Justin is a frequent speaker on industry panels and is a contributor to ETF Trends.

Prior to Newfound, Justin worked for J.P. Morgan and Deutsche Bank. At J.P. Morgan, he structured and syndicated ABS transactions while also managing risk on a proprietary ABS portfolio. At Deutsche Bank, Justin spent time on the event‐driven, high‐yield debt, and mortgage derivative trading desks.

Justin holds a Master of Science in Computational Finance and a Master of Business Administration from Carnegie Mellon University as a well as a BBA in Mathematics and Finance from the University of Notre Dame.