Pro Analysis

This is the one sector to own ahead of the election

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There's one sector that could surge ahead of the U.S. presidential election, if history is any guide.

In a note to clients Wednesday, UBS sized up the past four election cycles and created an "equity market blueprint" that forecast how the S&P 500 would fare in 2016.

"While presidential election years tend to be positive for equity markets - particularly the second six months - returns in the last year of a two term president's tenure (years including the Tech Bubble burst of 2000 and the Financial Crisis of 2008) have been decidedly less robust," wrote Julian Emanuel, executive director of U.S. equity and derivatives strategy at UBS.

As a result, the firm believes investors should focus on election years that resemble the current environment, marked by either "generational transitions" or "strong third party challenges," namely: Reagan in 1988, Clinton in 2000, Bush in 2008 and now Obama in 2016.