US Election: Trading Day Handbook

US Election: Trading Day Handbook, FP Markets

Election Day Trading Tips

FP Markets analyst Evan Lucas gives us his top 5 trading tips for election day. What to watch, where to do so, and the critical times in what shapes as a roller coaster ride like no other.

 

1.  Watch what matters not the headlines – Purple Haze

  • Florida – No Republican President since 1924 has won without Florida
  • Pennsylvania – 20 Colleague Votes, winner could take it all
  • Michigan – Rust Belt
  • Wisconsin
  • North Carolina – the toss up state

Biggest State here is Florida. If Trump losses Florida he won’t have enough College Votes to pass 270.

 

2. Watch the Bookie Sites

  • Oddschecker, Betfair and others. Watch for sharp change in odds.
  • Look for reported volumes – i.e. % of Bets placed.
  • In the past we have seen them go offline and then go up with the market completely flipped.

In 2016, Bookie odds changed at 10:50am AEDT from Clinton to Trump. This was the largest market impact of the Election Day.

3. Timings

  • Know when Purple states are due to declare, consider your open positions if the live counting suggests vote could be closer than expected.
  • Understand processing times and if states allow votes to arrive post-election day like Pennsylvania and North Carolina.
  • Mail-In and early voting. Over 55% of the total 2016 vote will be reached prior to Election day. It is likely to be a record turn out and could push back ‘Time Called’.

USD reactions in 2016 were strongest around Florida, Texas and Pennsylvania declarations.

 

COMIENZA A OPERAR

4. Recount/Contested Election

  • Close races in purple states can lead to recounts. Be aware candidates can petition for a recount. Key example Florida in 2000.
  • Case scenario: 270 Electoral College not met because of 1 or 2 States, and in this scenario results in these States are close enough to be contested. (Again, this was the case in 2000)
  • If the election becomes contested the Supreme Court of the United States (SCOTUS) could become involved. The Republican appointed Justices currently hold a 6-3 majority after the appointment of Justice Amy Coney-Barrett.

Volatility will be the biggest winner under this ‘Risk’.

5. Don’t forget the Senate

  • Senate Race is as, if not, more important than the White House race for FX as the make-up will determine the passing of legislation.
  • Senate Republicans are starting to show signs of blocking big fiscal spends. If Biden wins the Oval Office but the Republicans hold the Senate – could be a very risky setup for fiscal stimulus.
  • 35 Senate seats up for election, 12 Democrats, 23 Republicans. Polls suggest a very tight race and that there is a high chance of the Republicans holding the Senate.

This could be the biggest volatility event of the Election Day

For news, webinars, articles and analysis, visit our dedicated US Elections 2020 Page.

US Elections 2020
Webinar Series

Register and attend

Episode 1

Tue 29th Sep

7:00pm (AEST)

Market History & 1st Debate

View

Episode 2

Tue 13th Oct

7:00pm (AEST)

Electoral College and Swing States

View

Episode 3

Tue 20th Oct

7:00pm (AEST)

Trading Election Day and Post-Election

View

Episode 4

Mon 2nd Nov

7:00pm (AEST)

Election Day Trading Plan

View

Episode 5

Wed 11th Nov

7:00pm (AEST)

Election Results & Future Impact

Register

 

Disclaimer: La información contenida en este material está pensada únicamente como un asesoramiento general. No toma en consideración tus objetivos de inversión, situación financiera o necesidades particulares. FP Markets ha hecho todos los esfuerzos posibles por garantizar que, en la fecha de la publicación, la información es precisa. FP Markets no da ninguna garantía ni hace promesa alguna con respecto al material. Los ejemplos incluidos en este material solamente tienen fines ilustrativos. En la medida en que lo permita la ley, FP Markets y sus empleados no serán responsables de cualquier pérdida o perjuicio derivado en cualquier sentido (incluyendo por negligencia) de, o en relación con, cualquier información facilitada u omitida en este material. Las características de los productos de FP Markets, incluyendo tarifas y cargos aplicables, se resumen en las declaraciones sobre los productos que están disponibles en el sitio web de FP Markets, www.fpmarkets.com y que deberían tomarse en consideración antes de decidir realizar transacciones con esos productos. Los derivados pueden tener riesgos elevados; las pérdidas pueden exceder tu depósito inicial. FP Markets te recomienda que busques asesoramiento independiente. First Prudential Markets Pty Ltd, operando como FP Markets ABN 16 112 600 281, con la licencia de la Australian Financial Services número 286354.

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