How retail investors can avoid US election fever

Top tips to support retail investors through the US election

With the US election imminent, Advisers must help their investors avoid election fever and the risks of short-term thinking, says Hymans Robertson Investment Services (HRIS). This includes investment decisions inspired by either outcome predictions or, kneejerk reactions to the election result. Instead, they should remind investors of a few essential takeaways that inspire long-term thinking, the leading DFM adds.

Commenting on the need for caution if political change impacts markets, William Marshall, Chief Investment Officer, Hymans Robertson Investment Services (HRIS), says:

“Typically, significant political change increases market volatility. However, it’s important to remember that change in this type of situation is usually fleeting and Global macroeconomic drivers have shown to be more important over the long-term compared to politically driven change.”

Commenting on the value of simple messaging to helps investors avoid election fever and, instead, think long-term, William Marshall, continues:

“Once the results of the US elections are out IFAs may find the number of clients wanting to make investment decisions in response to market reaction increases. It may sound boring but, we often hear from Advisers that we partner with, that reminding clients of the basics is useful to help reduce the impact of external noise.

“No matter what happens caution should be taken around decisions based on polls, potential outcomes and policy changes. Using policy promises made in the run-up to elections as an example, if investors were to look back, they’d see that significantly less policies are actually made into law once the winning administration takes office.”