%0 Journal Article %A Jędrzej Białkowski %A Aynaz Nahavandi %T Midterm Elections’ Stock Market Surge: An Unintentional Gift from US Politicians %D 2019 %R 10.3905/jwm.2019.21.4.076 %J The Journal of Wealth Management %P 76-84 %V 21 %N 4 %X 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 %U https://jwm.pm-research.com/content/iijwealthmgmt/21/4/76.full.pdf