I can say with confidence that the 2024 U.S. presidential election will be unlike anything the world has ever seen before.
We have the two oldest candidates in history, up to four criminal trials against the former U.S. president, a stand-off between the current president and Texas regarding the southern border, potential war in the Middle East… And that’s just skimming the surface one month into this year.
The drama that will play out on national public television will be absurd.
Even the last 24 hours of TV coverage and online news articles (highlighting the clash between President Joe Biden and former President Donald Trump over the future of our country) have made me dread what’s coming…
It will only get worse as the year goes on. You will hear wild predictions about how this or that candidate will make or break the economy and your portfolio.
And while I agree that each candidate will impact the economy, I want to be very clear about something – the U.S. economy is far more adaptable and money-driven than some might realize.
Today, I’ll prove that while elections matter to the country, they don’t matter to your portfolio.
I’ll also share an opportunity for you to earn consistent and reliable long-term returns from blue-chip stocks that will thrive and help fund your retirement… No matter who wins the 2024 election – or any other.
Elections Matter – Just Not for Your Portfolio
The greatest investors in history don’t make investing decisions based on politics.
As Warren Buffett put it, “If you mix politics and investing, you’re making a big mistake.”
And he’s right.
Buffett recognizes portfolio returns are not solely at the mercy of who gets elected in Washington D.C. They can’t be.
The U.S. economy is the most dynamic in the world. And our companies are world-beaters, run by the most skilled and adaptable management teams.
They get paid the big bucks to adapt and overcome when bad things happen. And here’s proof…
Below are the historical stock return averages for all stocks based on which party controlled which branch of government at the time.
(Source: Forbes)
Yes, elections matter in terms of policy. But Americans have always adapted and thrived no matter what is happening in Washington.
And as you can see in the chart above, there’s a chance to profit under any conditions.
Beware the “Obvious” Stock Picks
When investing during an election year, the most dangerous talking heads are the media stock pickers you see in online articles or on TV.
They will throw out smart-sounding picks based on the current administration and assure you that you’ll make a boatload of money.
For example, “If Obama wins, green energy will slam dunk, and oil stocks will crash. He’s pro-green energy and hates oil.”
And another example, “If Trump wins, energy stocks will sour; it’s a slam dunk. He’s pro-oil. And green energy stocks will tank because he’s promised to pull the U.S. out of the Paris Agreement on Climate Change.”
Both sounded reasonable at the time, right?
Well, here’s what actually happened…
(Source: Ycharts)
The exact opposite… Green energy stocks tanked under Obama and were positive under Trump. While oil bottomed out under Trump and came back under Biden.
We won’t get into the geopolitical reasons this happened. But this is proof you shouldn’t base your investment strategy on assumptions of what stocks will do and what policies will actually make a difference to companies in any sector.
The reality is – money talks. And strong companies with excellent fundamentals will succeed no matter which political party is in the power seat.
A Reliable Income ETF – No Matter Who Wins the Presidency
At Wide Moat Research, we know what matters and what we should ignore… What is a risk to your savings and what is just dangerous noise spewed by a media trying to sell ads and make a buck during an election year.
That’s why we focus on the fundamentals of each pick we share with you, so you can achieve your income-lush retirement dreams.
And there’s one income vehicle you can buy today that’s built to succeed, no matter who ends up winning the 2024 presidential election – the Schwab U.S. Dividend Equity ETF (SCHD).
As I like to say – stock prices are vanity, cash flow is sanity, and dividends are reality.
Morningstar gives the Schwab Dividend ETF a five-star gold rating, and for good reason. Here’s how it beats out other high-yield blue-chip ETFs…
It starts out by screening for 10-year dividend growth streaks, to make sure it’s choosing the 100 most reliable dividend growers.
Why dividend growers, specifically? Why not dividend sustainers or cutters?
This has been the best-performing asset class year after year.
We’ve been through dozens of political cycles over the past 50+ years. And clearly, these have been the best stocks to hold throughout all of them.
This strategy has allowed the Schwab Dividend Growth ETF to deliver 13% annual returns historically, the same as the Nasdaq over the last few decades. And it yields 3.5% – more than twice as much as U.S. stocks on average.
SCHD has beaten 99% of its peers since it began trading over a decade ago (and back tested to the year 1999). And it still promises to deliver 12% to 13% long-term returns and grow its very safe dividend.
Today, SCHD is trading at 10x earnings, which is a 20% discount from its normal share price of 12x earnings.
So right now, is a great time to invest in SCHD. No matter what happens on the political stage in 2024 – divided growers are your best bet to grow your wealth exponentially over the long term.
Safe Investing,
Adam Galas
Analyst, Intelligent Income Daily