Markets

Trump vs. Biden: ETF Strategies for the Election Outcome

In this episode of ETF Spotlight, I speak with Matthew Bartolini, Head of SPDR Americas Research at State Street Global Advisors. We discuss how the presidential election outcome may influence investments, and implementation ideas to position portfolios.

We are now less than three weeks away from the election. Recent polls show former Vice President Biden has widened his lead over President Trump, particularly since the first presidential debate and Trump’s coronavirus infection.

A Biden win is likely to result in higher taxes for corporations and wealthy individuals. Trump’s re-election may benefit high-tax sectors like Consumer Staples and Retail.

The Trump administration levied hefty tariffs on Chinese imports, as well as on European products and services, some of which are likely to be repealed if Biden wins, benefitting international stocks. Domestically oriented mid- and small-cap companies may perform better if Trump wins a second term.

Biden has pledged to spend $2 trillion to combat climate changeand support renewable energy. We have seen a surge in solar and clean energy ETFs like the Invesco Solar ETF (TAN) the SPDR S&P Kensho Clean Power ETF (CNRG), in recent weeks.

Biden also plans more health spending to combat, treat and trace COVID-19. Take a look at the SPDR S&P Biotech ETF (XBI), and the SPDR S&P Health Care Equipment ETF (XHE).

Mega-cap tech giants like Apple (AAPL), Amazon (AMZN) and Facebook (FB), which had excellent performance and profit growth under the Trump administration, may face greater antitrust scrutiny under a Biden administration.

We also discussed some investment ideas to capitalize on long-term trends accelerated by the pandemic. Tune into the podcast to learn more.

Make sure to be on the lookout for the next edition of ETF Spotlight! If you have any comments or questions, please email podcast@zacks.com.

(In full disclosure, Neena owns shares of XBI and XHE in the ETF Investor Portfolio.)

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Amazon.com, Inc. (AMZN): Free Stock Analysis Report
 
Apple Inc. (AAPL): Free Stock Analysis Report
 
Facebook, Inc. (FB): Free Stock Analysis Report
 
SPDR SP Homebuilders ETF (XHB): ETF Research Reports
 
Invesco Solar ETF (TAN): ETF Research Reports
 
SPDR SP Biotech ETF (XBI): ETF Research Reports
 
SPDR SP Health Care Equipment ETF (XHE): ETF Research Reports
 
SPDR SP Kensho Clean Power ETF (CNRG): ETF Research Reports
 
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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