Companies Need a New Approach to Investing This Election Year

Election years have long been characterized by increased policy uncertainty, which typically reverts to lower levels after the results become known. Opposing parties have different views on a gamut of economic policies that affect firms’ growth, risks, and profitability. This pattern of uncertainty buildup followed by its sudden post-election decline has been observed at levels across the political spectrum, including U.S. gubernatorial and presidential elections as well as major elections around the globe.