@article {Bia{\l}kowski76, author = {J{\k e}drzej Bia{\l}kowski and Aynaz Nahavandi}, title = {Midterm Elections{\textquoteright} Stock Market Surge: An Unintentional Gift from US Politicians}, volume = {21}, number = {4}, pages = {76--84}, year = {2019}, doi = {10.3905/jwm.2019.21.4.076}, publisher = {Institutional Investor Journals Umbrella}, abstract = {This article provides evidence for the existence of a midterm election effect. By examining the quarterly total returns on the S\&P 500 Index between 1954 and 2017, we show that, 9 times out of 10, the index has been positive in the fourth quarter of a midterm election year and the following two quarters. These returns compound to nearly 25\% in those three quarters. Neither changes in the monetary nor the fiscal policies were able to explain the effect. We show that the known third year of a presidential term effect is weaker than the examined midterm election effect.TOPICS: Mutual funds/passive investing/indexing, financial crises and financial market history, performance measurement}, issn = {1534-7524}, URL = {https://jwm.pm-research.com/content/21/4/76}, eprint = {https://jwm.pm-research.com/content/21/4/76.full.pdf}, journal = {The Journal of Wealth Management} }