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Seasonal Trading

The S&P 500 in Post-Election Years: What History Tells Us

Post-Election Years – A Seasonal Perspective

SP500 Post election cyle analysis


The Unique Nature of Post-Election Years

Every four years, the U.S. presidential election reshapes the political and economic landscape. For investors, this period offers a unique opportunity to leverage the historical tendencies of the S&P 500 Index during post-election years. These trends can provide invaluable insights for strategic trading and portfolio positioning.


The S&P 500's Post-Election Performance

Historically, post-election years often show a mix of optimism and caution. Markets typically respond to the economic policies of the newly elected or re-elected administration, which can lead to significant fluctuations in investor sentiment. For example:

  • ✅ Over the past 40 years, the S&P 500 has performed well on average in post-election years, with gains averaging around 15%, depending on the general economic cycle.
  • ✅ Certain sectors often outperform as administrations prioritize spending or reforms.
  • ✅ Volatility tends to spike during key announcements, making timing critical for traders.

The graph shows the 40-year development of the election year cycle. The area marked in blue is the post-election year. It is easy to see that the post-election year had a good historical development.

SP500 Seasonal Election cycle chart

SP500 Seasonal Election cycle

The following chart shows the annual development of the individual post-election years. Please note the maximum declines/drawdowns, which show that the post-election years can also be characterized by volatility.

SP500 Post Election year development

SP500 yearly statistic (40y) - post-election years

How to Analyze the S&P 500’s Seasonal Trends in Post-Election Years

The beauty of seasonality is its repeatability. The S&P 500 tends to exhibit recurring patterns influenced by macroeconomic policies, consumer confidence, and fiscal measures. For example:

  • January was historically a good month
  • February and March show mixed developments and greater volatility.
  • April and May are historically very positive months
  • June and July rather mixed
  • August and September are historically bad months
  • From October onwards, the year-end rally sets in and signals rising prices. Small professional tip: October usually starts its upward trend in the middle of the month.

SP500 monthly statistic

SP500 monthly statistic (40y) - post-election years

Analyzing Sectors of the S&P 500 with the Seasonal Comparison Tool in Post-Election Years

Sector-specific trends often influence the performance of the S&P 500 during post-election years. Different sectors of the economy react uniquely to the changing policies and economic priorities set by a new administration. Using the Seasonality Comparison Tool from Seasonality.ai, traders can understand how various sectors perform during these critical years and identify high-probability opportunities.

SP500 Sectors - Seasonal Development.

The seasonal development of the sectors shows that the conservative sectors performed the worst. This shows that the post-election years have a good history for the broad market.

The table to the right of the chart shows the best sectors.

How to Analyzing Post-Election Year Trends with the Seasonality Analyser

To unlock the full potential of S&P 500’s post-election trends, the Seasonality Analyser is your ultimate tool. Here’s how it works:

  1. Input Your Data: Start by selecting the S&P 500 Index as your target instrument in the Seasonality Analyser.
  2. Select Timeframes: Narrow your analysis to post-election years. The tool allows you to filter historical data specific to these years.
  3. Exclude all non-post-election years.
  4. Press Create Analysis

The result shows you all the important information you need to make well-founded decisions for seasonal analyses.

It is also possible to display the individual seasonal developments of the election years without excluding election years. All you have to do is click on the Election years button above the seasonal chart.

Why Use the Seasonality Analyser?

  • Precision Insights: Gain access to data-driven forecasts that reveal exact opportunities for entry and exit points.
  • Time-Saving Analysis: The screener and analyzer work seamlessly to provide instant results tailored to your strategy.
  • Confidence in Strategy: Backtest your approach with detailed historical data to minimize risk and maximize returns.
  • With the Seasonality Screener, you can find the best seasonal patterns with just one click.
  • Our ready-to-use seasonal strategies offer you the best seasonal patterns in one strategy.

Seize the Opportunity in Post-Election Trends

Don’t leave your trading results to chance. Start leveraging the power of recurring patterns in post-election years with Seasonality.Ai. Whether you're an experienced investor or new to seasonal trading, our tools offer unparalleled insights to maximize your success.

👉 Join now and access the Seasonality Analyser to turn insights into action!

Warm regards,
The Seasonality.ai Team

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