Dividend Stocks, Editors' Pick

How to Safely Profit From This Crazy Election

Adam Galas

13 postsNovember 6, 2020

I think we can all agree this has been the most dramatic election in modern history. And the drama that has dominated our lives for the past year continues even after the voting ended.

(Source: NYT)

Normally one or two close state races decides who will become president. This time there are five states that will decide the winner. As of Friday morning, all have margins of 1.5% or less, and about 500,000 votes have yet to be counted.

If a state is within 1% a candidate can request a recount. Those can take up to two weeks to start. They usually take about a week to finish. In other words, even after a winner is declared, it might take another three weeks before we can know the results for certain.

Meanwhile, control of the Senate, and thus whether we have a divided or unified government, will hinge on the Georgia runoff on January 5^th, 2021. The outcome of the most important election in modern history, won’t be fully known until January 6^th, or possibly even later.

All of this is taking place as the worst pandemic in over 100 years rages uncontrolled through most of America. What does the toxic combination of political uncertainty and an out-of-control pandemic mean for the economy, stock market, and your portfolio?

In the Short-Term A Lot of Economic Uncertainty and Potentially Wild Swings in Stock Prices Are Likely

In the last few weeks, most economists and analysts were expecting a Democratic blue wave. This means a Biden win and Democrats controlling both houses of Congress.

This would have probably resulted in higher corporate taxes and regulations. However, the bigger stimulus such unified government would have likely passed was expected to drive very strong economic and thus corporate earnings growth.

As things stand now, it’s very likely Biden will become president, and Democrats will keep the house. But the GOP will likely control the Senate.

This means the chances of major reforms or new taxes are much lower. This is likely why stocks just had their best four-day election rally in history.

But in this year of wild twists and turns, investors can’t become too euphoric or complacent. While the chances of a unified government are now much lower, they are not zero. Georgia will have two Senate run-offs on January 5^th and Joe Biden appears to have won that state. In other words, Georgia is now a full-blown swing state.

I have no doubt that both Republicans and Democrats, including President Trump and Vice President Biden, as well as many other party rock stars, will campaign hard in the peach state in the coming weeks.

Tens of millions, potentially hundreds of millions, of dollars will be poured into what might prove to be the two most important races of this election season.

Literally the fate of trillions of dollars of future stimulus spending, taxes, and regulations could be decided on January 5^th in Georgia.

Most political experts believe the Republicans are likely to win both Senate run-off races. But there is a small but significant chance that Democrats could win them, and gain control of the Senate.

Whether or not we get a double-dip recession from this raging pandemic, could depend on the outcome of who controls the White House and Congress. And that’s something we won’t know for two more months.

How Investors Can Stay Safe and Even Profit from This Crazy Election

It’s critical to remember that no matter who wins elections, or what happens to the economy in the short-term, the stock market always goes up over time.

Since 1926 the market goes up 75% of all years. Over 16+ year periods, the S&P 500 has always delivered profits for long-term investors.

That’s assuming you were able to remain disciplined, patient, and most of all, calm, during periods of high uncertainty and short-term volatility.

I have 100% of my life savings invested in the stock market. I’ve remained fully invested for many years.

I have never lost a wink of sleep, not even when the stock market fell 34% in March. What’s my secret?

Simply a strong combination of risk-management, diversification, and above all, a focus on quality blue-chips bought at reasonable to attractive valuations.

These core fundamentals are the most tried and true income and wealth compounding principles ever discovered in finance. My life savings is entrusted to the strongest companies on earth, with fortress balance sheets. These blue-chips are run by competent, trustworthy, and experienced management. Management that has a track record of delivering generous, safe, and steadily growing dividends in all political, economic, and market conditions.

In the short-term, anything can, and will, happen in the stock market. In just the last few days, we’ve seen stocks suffer their worst week since March. We’ve also seen some stocks, such as healthcare giants, rally as much as 14% the day after the election.

Good long-term investors tolerate volatility and pray for luck in the stock market.

Great long-term investors embrace volatility and harness it for their benefit.

The secret to staying safe and profiting from short-term uncertainty, of any kind, is to always stay calm, rational, and disciplined. Trust in the quality of your companies and your portfolio’s risk management to see you through the short-term pain, so you can enjoy the long-term gains that sound investing always provides over time.

Happy Investing

Adam Galas

13 posts

View all my Posts

Adam Galas is a retired Army Medical Services Officer with an economics degree from the University of Minnesota who combines his 23 years of investing experience with a disciplined application of time-tested methods. Adam is holding or has held positions as a professional analyst at The Motley Fool, Seeking Alpha, and Simply Safe Dividends. His work has also appeared on thestreet.com, Forbes and Stocknews.com.

Due to his love of Buffett-style investing in safe, undervalued, dividend growth stocks, Tipranks recently ranked him Americas 43rd best analyst. And he is the second-most followed writer on Seeking Alpha, where as he is also a co-founder of Dividend Kings.

Thanks to a love of Buffett-style investing in safe, undervalued, dividend growth stocks, he was recently ranked the 43rd best analyst in the country by Tipranks and is the second-most followed writer on Seeking Alpha.

A Costly Investing Mistake You Need To Avoid

REIT Mutual Fund	Symbol
Alpine Realty Income and Growth Fund	AIGYX, AIAGX
American Century Real Estate Fund	REAIX, REACX, AREEX, AREWX, ARYCX, AREDX
Real Estate Securities Fund	MRESX
AR Capital Real Estate Income Fund	ARIAX, ARICX, ARIPX
AssetMark Real Estate Securities Fund	AFREX
Aston/Harrison Street Real Estate Fund	AARIX, ARFCX
Baron Real Estate Fund	BREIX, BREFX
BlackRock Real Estate Securities	BIREX, BAREX, BCREX
Brookfield U.S. Listed Real Estate Fund	BRUAX, BRUCX, BRUIX, BRUYX
CGM Realty Fund	CGMRX
West Loop Realty Fund	REIIX, REIAX, REICX
Cohen & Steers Institutional Realty Shares	CSRIX
Cohen & Steers Realty Income Fund	CSEIX, CSDIX, CSBIX, CSCIX
Cohen & Steers Realty Shares	CSRSX
Columbia Real Estate Equity Fund	CREAX, CREIX, CRRVX, CRERX, CREEX, CRRFX, CREWX, CRECX, CREBX
Compass EMP REC Enhanced Volatility Weighted Fund	CWRAX, CWRIX, CWRTX, CWRCX
Davis Real Estate Fund	RPFRX, DREYX, DRECX, DREBX
Delaware Real Estate Investment Trust Portfolio II	DPRTX, DPRBX
Delaware Real Estate Investment Trust Portfolio	DPREX, DPRSX, DPRRX, DPRCX
DFA Real Estate Securities Portfolio	DFREX
Dunham Real Estate Stock Fund	DAREX, DNREX, DCREX
DWS RREEF Real Estate Securities Fund	RRRRX, RRREX, RRRAX, RRRSX, RRRBX, RRRCX
DWS RREEF Real Estate Securities Income Fund	REFAX, REFCX, REFIX, REFSX
Eaton Vance Real Estate Fund	EAREX, EIREX
EII Realty Securities Fund	EIIRX
Fidelity Advisor Real Estate Fund	FHEIX, FHEAX, FHETX, FHECX, FHEBX
Fidelity Advisor Real Estate Income Fund	FRIRX, FRIQX, FRINX, FRIOX
Fidelity Real Estate Income Fund	FRIFX
Fidelity Real Estate Investment Portfolio	FRESX
Fidelity Spartan Real Estate Index Fund	FSRNX, FRXIX, FSRVX
Fidelity Series Real Estate Equity Fund	FREDX, FREFX
Fidelity Series Real Estate Income Fund	FSREX, FSRWX
Forward Real Estate Long/Short Fund	KSRYX, FRLSX, FFSRX, KSRAX, KSRCX, KSRBX
Forward Real Estate Fund	FPREX, FFREX, KREAX, KRECX
Forward Select Income Fund	KIFYX, FSIMX, FFSLX, KIFAX, KIFBX, KIFCX
Franklin Real Estate Securities Fund	FREEX, FRLAX, FRRSX, FSERX
GMO Real Estate Fund	GMORX
Goldman Sachs Real Estate Securities Fund	GREIX, GRETX, GREAX, GRESX, GRERX, GREBX, GRECX
Great-West Real Estate Fund	MXREX
Heitman REIT Fund	OARTX, OBRTX
ING Real Estate Fund	CRARX, IREWX, IDROX, CLARX, CRWRX, CRCRX, CRBCX
INVESCO Real Estate Fund	REINX, IARFX, IARIX, IARYX, IARAX, IARRX, IARCX, AARBX
Ivy Real Estate Securities Fund	IRSAX, IREIX, IRSYX, IRSRX, IREEX, IRSCX, IRSBX
John Hancock Real Estate Securities Fund	JIREX
Johnson Realty Fund	JRLTX
J.P.Morgan Realty Income Fund	URTLX, JRIRX, URTAX, URTBX, URTCX
J.P. Morgan Security Capital U.S. Core Real Estate Securities Fund	CEEAX, CEERX, CEEFX, CEESX, CEECX
J.P. Morgan U.S. Real Estate Fund	SUSIX
Lazard U.S. Realty Equity Portfolio	LREIX, LREOX
Lazard U.S. Realty Income Portfolio	LRIIX, LRIOX
Manning & Napier Real Estate Series	MNRIX, MNREX
Morgan Stanley Institutional U.S. Real Estate Portfolio	MSUSX, MUSDX, MSULX, MURSX
Natixis AEW Real Estate Fund	NRFAX, NRFYX, NRFBX, NRFCX, NRFNX
Neuberger Berman Real Estate Fund	NBRIX, NBRFX, NREAX, NRERX, NRECX, NRREX
Nuveen Real Estate Securities Fund	FREAX, FARCX, FRSSX, FREBX, FRLCX, FREGX
Oppenheimer Real Estate Fund	OREAX, OREIX, OREYX, ORENX, OREBX, ORECX
PHOCAS Real Estate Fund	PHREX
PIMCO RealEstateRealReturn Strategy Fund	PRRSX, PETPX, PETAX, PETDX, PETCX, PETBX
Pioneer Real Estate Shares	PWREX, PYREX, PCREX, PBREX
Principal Real Estate Securities Fund	PIREX, PIRPX, PREPX, PRETX, PREJX, PRRAX, PRERX, PRENX, PRAEX, PRCEX, PRLEX
ProFunds Real Estate UltraSector ProFund	REPIX
Prudential Select Real Estate Fund	SREAX
Prudential U.S. Real Estate Fund	PJEAX, PJEZX, PJECX, PJEBX
REMS Real Estate Income 50/50 Portfolio	RREIX
REMS Real Estate Value-Opportunity Fund	HLRRX, HLPPX
Rydex Real Estate Fund	RYREX, RYHRX, RYCRX
SA Real Estate Securities Fund	SAREX
SEI Institutional Mgd Real Estate Fund	SETAX, SEIRX
Spirit of America Real Estate Income & Growth Fund	SOAAX
SSgA Clarion Real Estate Fund	SSREX
Stratton Real Estate Fund	STMDX
T.Rowe Price Real Estate Fund	TRREX, PAREX
TIAA-CREF Real Estate Securities Fund	TIREX, TRRPX, TRRSX, TCREX
Vanguard REIT Index Fund	VGSNX, VGRSX, VGSLX, VGSIX
Virtus Real Estate Securities Fund	PHRAX, PHRIX, PHRCX, PHRBX

REIT ETF	Symbol
Flex Shares	ASET
Wisdom Tree Global Ex-US	DRW
S&P 500 Equal Weight	EWRE
iShares FTSE Industrial/Office	FNIO
MSCI Real Estate Index	FREL
S&P REIT Index	FRI
First Trust S&P REIT	FRI
iShares Real Estate 50	FTY
Flexshares Global	GQRE
iShares Cohen & Streers	ICF
iShares International Developed RE	IFGL
iShares US RE	IYR
Premium Yield Equity REIT	KBWY
ETRACS Monthly Pay 2x Leverage	MORL
Market Vector Mortgage	MORT
iShares Global REIT	REET
iShares FTSE Mortgage	REM
iShares Residential	REZ
IQ US Real Estate Small Cap	ROOF
iShares FTSE NAREIT Retail	RTL
DOW Jones Global RE	RWO
SPDR Dow Jones	RWR
Schwab US REIT	SCHH
Super Dividend REIT	SRET
ProShares Ultra RE	URE
Vanguard REIT	VNQ
Vanguard Global ex-US	VNQI
iShares International Developed	WPS
Wilshire US REIT	WREI
Pacer Benchmark Data & Infrastructure RE	SRVR
Pacer Benchmark Industrial RE	INDS
Pacer Benchmark Retail RE	RTL
Hoya Capital Housing	HOMZ
NetLease Corporate RE	NETL

REIT Name	Ticker	Annual Increases/yr
Federal Realty	FRT	51
Universal Health Realty	UHT	33
National Retail Properties	NNN	29
Realty Income	O	27
Tanger Outlets	SKT	26
Urstadt Biddle	UBA	25
Essex Property Trust	ESS	25
W.P.Carey	WPC	22
National Health Investors	NHI	17
Equity Lifestyle	ELS	15
Digital Realty	DLR	15

How to Safely Profit From This Crazy Election

Adam Galas

13 postsNovember 6, 2020

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How to Safely Profit From This Crazy Election

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