Between the close of May and the close of October, the S&P 500 has rallied 19 of the last 22 election years (86 percent of the time) for an average gain of 6.2 percent. Although the stats for a rally look compelling, the results are skewed by significant volatility in a few election years.
The S&P 500 lost nearly 31 percent in 2008, while posting a 55.7 percent gain in 1932 and approximately 19.5 percent gains in 1936 and 1940. The median gain of 4.1 percent may be a more realistic measure. Nonetheless, the market has had a tendency to trade higher.
The S&P 500 has also traded strongly during the summer months of June, July and August, posting average monthly gains of 1.5 percent, 1.9 percent and 3.0 percent, respectively.
Prices were higher 77.3 percent of the time in June, just half of the time in July and 76.2 percent of the time in August. Across the period, stocks rose 76 percent of the time for an average return of 7.1 percent and median gain of 3.3 percent.