S&P 500 in Presidential Election Years: 1928-2024 Data

Presidential Election Years and the S&P 500: 1928–2024

Every four years, US investors are told that a presidential election will make or break their portfolio. The data says something more interesting — and more useful. Since 1928, the S&P 500 has averaged roughly +11.3% in total return during presidential election years and finished higher in 21 of 25 of them. The years it lost money were not about who won; they were full-blown macro crises. And the market behaves very differently when a sitting president is defending the office than when the race is wide open.

This is the complete reference: every US presidential election year from 1928 through 2024, the S&P 500's calendar-year return, whether an incumbent was on the ballot, the only four down years and why they fell, the "stock market predicts the winner" signal, and what the four-year cycle implies for the road to 2028.

Why Election Years Are Usually Green

In the four-year presidential cycle, the election year is "Year 4." Across the 25 elections since 1928, the S&P 500's average price return (dividends excluded) was about +8.1%, and the average total return (with dividends reinvested) was about +11.3% — close to, and in some studies slightly above, the long-run average for all years.

The hit rate is the headline. Nineteen of the 25 election years closed higher on price alone; on a total-return basis, 21 of 25 were positive — roughly 84%. That is a strong base rate for a single calendar year. Only four election years lost money once dividends are counted, and as the next section shows, each was a genuine economic emergency rather than an election story.

Why the upward tilt? The most-cited explanation is the political-incentive cycle. Administrations tend to absorb economic pain early in a term and steer toward growth-friendly conditions — spending, tax policy, a cooperative-where-possible Federal Reserve — heading into a re-election year. Whether or not you buy the causation, the pattern rhymes with the rest of the cycle: as our companion reference on midterm election years and the stock market shows, the midterm year (Year 2) is the weakest of the four at about +4.6% since 1950, and the pre-election year (Year 3) is the strongest at about +17.2%. The election year sits comfortably above the midterm and just below the pre-election peak.

Every Presidential Election Year Since 1928: The Reference Table

S&P 500 price returns, dividends excluded, rounded. "Incumbent on ballot" means a sitting president was running for re-election; 1976 (Ford) and 2024 (Biden withdrew; Harris ran) are noted below.

Two features jump out. First, the upside dominates: ten of these years gained more than 13%, and the median outcome is firmly positive. Second, the downside is rare but brutal — and clustered. Every negative year coincides with a recession, a war, or a market crash. There is no election year in nearly a century where stocks fell simply because of politics.

The Only Down Election Years Were Crises

On a total-return basis, only four election years since 1928 lost money, and the cause was the same each time — a macro shock, not the ballot box:

• 1932 (−15.1%): the depths of the Great Depression, with unemployment near 25%.
• 1940 (−15.3%): Germany's invasion of Western Europe and the collapse of the phony-war calm.
• 2000 (−10.1%): the bursting of the dot-com bubble, which ran for nearly three years.
• 2008 (−38.5%): the global financial crisis, the worst calendar year for US stocks since 1931.

(On a price basis, two more years dip fractionally below zero — 1948 at −0.7% and 1960 at −3.0% — but both turn positive once dividends are added, which is why the standard "four down election years" count uses total return.)

The practical lesson is the one that recurs across every market-history reference: election-year losses are macro events, full stop. If you want the full anatomy of the declines behind 2000 and 2008, our reference on every S&P 500 bear market since 1929 traces each one's depth and recovery time. The corollary matters for 2028 and beyond: the question that determines whether an election year is up or down is not "who is leading the polls?" — it is "is the economy heading into a recession?"

Incumbent on the Ballot vs. Open Race

Here is the split most election commentary misses. The market has historically done meaningfully better when a sitting president is defending the office than when the race is open with no incumbent on the ballot.

• Incumbent on the ballot (16 races): +9.5% average. When a president is running for re-election, the cycle's growth-into-the-vote incentives are at full strength.
• Open races (9 races): +5.7% average — and just +1.6% if you exclude the outlier 1928 and look at the eight open races since 1952.

The tell is in the tails. All three of the worst modern election years — 1960 (−3.0%), 2000 (−10.1%) and 2008 (−38.5%) — were open races with no sitting president defending the White House. Open races stack two uncertainties on top of each other: an unknown winner and a guaranteed change of administration, with all the policy repricing that implies.

The pattern is a tendency, not a law. 2024 is the standout exception: Joe Biden withdrew, Vice President Harris ran in his place, and the race was effectively open — yet the S&P 500 returned +23.3%, carried by the AI-capex boom that pushed Nvidia and the rest of the megacaps to records. When the underlying economy and a powerful secular trend are strong enough, they override the election template. That is the through-line of this entire reference: the macro backdrop is the dominant variable, and the election structure is the modifier.

Can the Stock Market Predict the Winner?

One of Wall Street's most durable election folk-statistics runs the causation the other way: the market predicts the politics. The signal is the S&P 500's direction in the three months before the vote (roughly August through October).

The historical record is striking. Since 1928, when the S&P 500 has risen in the three months ahead of the election, the incumbent party has usually held the White House; when it has fallen, the challenger has usually won. By most counts the indicator has aligned with the result in roughly 87% of elections (about 20 of 24), with the notable misses in 1956, 1968, 1980 and 2016. October is the sharpest tell — down Octobers have been disproportionately associated with the incumbent party losing.

The logic is intuitive: a rising market reflects an electorate that feels economically secure and is inclined to keep the status quo, while a falling market signals stress that favors change. Treat it as folklore with a real track record, not a trading edge — the sample is small, and a handful of misses in a 24-observation series is exactly what you would expect from noise. But it is a clean reminder that the market and the election are reading the same underlying economy.

Does It Matter Which Party Wins?

Less than the headlines imply. Decades of return data show that the S&P 500 has compounded under both Democratic and Republican presidents, and that average returns under divided government are similar to — and in several studies modestly better than — returns under unified control. The market's revealed preference is for the resolution of uncertainty and, often, for legislative gridlock that keeps big policy swings off the table.

What the result genuinely moves is sector composition, not the index. Which party controls Congress and the White House reshapes expectations for tax, energy, defense, health care and antitrust — a stock-picking question rather than an index question. That distinction matters more in this era than in past cycles because index concentration is so extreme: as our breakdown of the Magnificent 7's weight in the S&P 500 shows, roughly seven stocks now drive about a third of the index, so a handful of AI-exposed names can swamp whatever rotation an election result sets off.

Where the Cycle Stands Now: The Road to 2028

The 2024 election year is in the books at +23.3%. Here is where the four-year clock points next:

• 2025 — Post-election year (Year 1). Historically the second-weakest year of the cycle, as a new term front-loads less market-friendly policy.
• 2026 — Midterm year (Year 2). The weakest year on average (+4.6% since 1950) with the deepest typical drawdown. Our midterm reference table flags the September–October window as the cycle's historical bottom zone — and the S&P 500 has been higher 12 months after all 19 midterms since 1950.
• 2027 — Pre-election year (Year 3). The strongest year of the cycle by a wide margin (+17.2% average), as the incentive to support growth into 2028 kicks in.
• 2028 — The next presidential election. Based on this table, the base case is a positive year — unless a recession arrives, which is the only condition that has reliably turned an election year red.

Two crosswinds will shape how cleanly that template plays out. The first is whether the AI-capex cycle that powered 2024 keeps broadening beyond chips into power, networking and memory, or stalls. The second is the seasonal map within each year — our S&P 500 seasonality reference pairs naturally with the election cycle for timing the typical autumn-weakness, year-end-strength rhythm. For the recession question that ultimately decides each election year's sign, the yield-curve inversion table remains one of the cleanest long-lead signals on record.

How to Trade the Election Cycle with AI

A calendar base rate is a starting point, not a strategy. The way to use this reference is to combine the cycle's when — election-year tailwind, midterm-autumn weakness, pre-election strength — with live confirmation from breadth, positioning and macro data. That blend of pattern and real-time judgment is exactly what multi-agent AI is built for.

On SimianX, the AI model leaderboard runs 30 AI models from 6 providers on real trading P&L, so you can see which models are actually navigating the current tape rather than backtesting it — we broke down which AI model is the best trader from that live data. If you would rather have the process run without screen time, AI autopilots can execute a rules-plus-AI strategy around events like an election continuously; the mechanics are covered in our guide to running a 24/7 AI trading bot on autopilot, and plans start free. Crypto traders can watch the same risk-appetite swings play out in Bitcoin, which has historically amplified the relief rallies equities show once election uncertainty resolves.

FAQ

Are presidential election years good for the stock market?

On average, yes. Since 1928 the S&P 500 has averaged roughly +11.3% total return in election years and finished higher in 21 of 25 — about 84% of the time. The upward tilt reflects the political-incentive cycle of steering toward growth into a re-election vote.

What was the worst presidential election year for stocks?

2008, at −38.5% for the S&P 500's price return, during the global financial crisis. 1940 (−15.3%, WWII) and 1932 (−15.1%, the Great Depression) are the next worst. All of the down election years coincided with a recession, a war or a crash — never with the election itself.

Does it matter which party wins the presidency?

Historically, far less than investors expect. The S&P 500 has risen under both parties, and average returns under divided government match or beat unified control. The election result mainly reshuffles sector winners and losers; it does not reliably set the direction of the index.

Can the stock market predict the election?

There is a real track record. When the S&P 500 rises in the three months before the vote, the incumbent party has usually won; when it falls, the challenger has usually won — accurate in roughly 87% of elections since 1928, with misses in 1956, 1968, 1980 and 2016. Treat it as folklore with a good record, not a guarantee.

What does the election cycle say about 2028?

2028 is the next presidential election year, and the base rate favors a positive year. The bigger swing factor is the run-up: 2026 (midterm) is historically the weakest year and 2027 (pre-election) the strongest, so the cycle points to choppiness into late 2026 followed by strength heading into the 2028 vote — unless a recession intervenes.

Sources & Further Reading

• Presidential Election Cycle Theory — Investopedia
• United States presidential elections — Wikipedia
• S&P 500 historical data — S&P Dow Jones Indices
• Companion references on SimianX: midterm election years and the stock market, S&P 500 seasonality by month, every S&P 500 bear market since 1929, and the yield curve inversion table.

Past performance does not guarantee future results. This reference is for information and education, not investment advice.