The Polls and Your Portfolio
How Does the Election Affect My Portfolio? As Americans head to the polls to exercise their right to vote in the presidential election, they bring many issues and beliefs with them. For some voters, these include questions about their portfolio and how the winner of the election could impact their savings, retirement, and ultimately, their future.
The answer, many financial analysts say, is not much.
Analysts have found that the market has remained stagnant in the year leading up to an election for the past 100 years. Although there hasn’t been any significant change to warrant concern, voter concern over uncertainty tends to be reflected in the market. After the ballots are counted and a president-elect is chosen, the market may see a downward trend if a new president (not incumbent) takes office. Again, this is likely due to uncertainty and concern. Still, the market always ebbs and flows, and most presidents leave office with normal markets. However, what impacts your portfolio more may be congressional elections, which decide who our lawmakers are. Law creation, divided government, and responses to those laws influence portfolio performance more than most presidential elections. Remember, the market responds to reaction, and whom we elect to Congress and how they legislate more directly impacts our lives than the president.
The pandemic that has rocked 2020 has given us plenty of lessons on market volatility. As COVID-19 swept across the U.S., many residents had to shelter in place while industries shut down for an unprecedented hiatus. Financial planners and analysts encouraged patience to allow this storm to pass while they tried to identify long- term change. As we’re still recovering from this pandemic, so is the market, which could have an influence on the correlation between the election and the stock market. That said, if the past 100 years are any indication, you have little to worry about. Whoever occupies the Oval Office in 2021 will have very little influence on your portfolio. Your best financial strategy is to do the same thing you’ve been doing throughout the pandemic: Remain patient.
How to Have a Profitable Business in Any Economy
People start and buy businesses for many different reasons. Some people do it as an extension of their passion for a certain thing, such as flowers, woodworking, machinery, or serving people. Some people do it for the thrill of winning. But ultimately, everyone who goes into business does it to make money. Thousands of books have been written on the subject, telling you what to do and what not to do, but ultimately, making money in business is not that difficult. Listed below are a few fundamentals in order to have a profitable business. Income – Expenses = Profit. Income is determined by how much money is generated by the business. Expenses are what the business needs to operate. Profit is what is left over after deducting the expenses from the income. You can always increase your income, but you can only reduce your expenses so far
before you don’t have enough of the basics to keep the business operating.
Sales: A lot of people don’t like to hear the word sales because they don’t want to be in sales or affiliated with sales, but without sales, there is no business. Sales IS the business. The major goal of EVERY business is to increase sales because without sales, there is no income. Sales, combined with income and expenses, is a formula for ALL industries. It doesn’t matter if you are operating an exercise/yoga clinic or a computer chip manufacturer — the formula is the same. Even churches have a sales department to entice their congregation to give more. Sales are what makes the world go around.
you will develop a business model that works. This is called a profitable business.
To add more profits, hopefully the business model you have created is scalable, and you can duplicate the business model either through franchising, dealers who represent your business model, or additional facilities using the same business model you created and perfected. What I have explained is nothing fancy and very simplistic. This formula is applicable in any geographic area and to any business. Anything else beyond the Sales = Income – Expenses = Profit model is called an excuse. I was taught this early on in my business career: “You can make money or you can make excuses, but you can’t make both.”
Over time, as you practice and perfect the formula (Sales = Income – Expenses = Profit),
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