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If you like market volatility, you're going to love the next president

Markets are giving off fear signals as Donald Trump has risen in national polling, but U.S. markets may get a big dose of volatility after the election no matter who wins.

In the last two weeks, the CBOE Volatility Index (.VIX) — also known as "the fear index" — has skyrocketed 65 percent, and its rise has mirrored Republican presidential nominee Trump's upswing in the polls.

Many traders believe if Trump manages to win the election, then the VIX will rise due to the perceived uncertainty he would bring to both domestic policy and the global stage. But if Democratic nominee Hillary Clinton wins — as many pollsters and pundits believe she will — it's also very possible that the fear index won't drop to pre-election levels quickly.

'Volatility may ebb, but it doesn't go away'

"The VIX will go higher short term," said Jon Najarian, trader on CNBC's "Halftime Report," who added that "the speculation over investigations and potential criminal charges against her and her associates won't go away so quickly, and with that hanging out there, volatility may ebb, but it doesn't go away."

Republicans have threatened to intensify investigations of the Clinton Foundation if she becomes president. The nonprofit has come under fire for the appearance of giving donors access to Clinton while she served as secretary of state — although so far no charges have been filed.

While there is no precedent for it, it's possible for President Barack Obama to issue a pardon to Clinton ahead of her presidency if she's elected, and even ahead of a prosecutor's investigation into her connection with the Clinton Foundation and any of her other activities that have drawn negative attention, such as her use of personal email to handle state business.

An advance pardon?

A pardon would erase the possibility of traditional punishment for Clinton, but it would not protect her from a congressional investigation or even impeachment, said George Washington School of Law professor Jonathan Turley, who has written extensively about constitutional law.

Turley said, however, that a pardon "would destroy the viability of her presidency, as she would be governing under a cloud that would be a reminder to Americans that there are two levels of justice."

Investigations against Clinton "could be quite serious, and if I were advising her I would prepare her for a serious investigation of the Clinton Foundation," said Turley.

Najarian agreed that an early presidential pardon to Clinton from Obama would be damaging, "turning her into a lame duck."

But it would likely be good for investors who like market volatility.

People wearing the masks of presidential candidates Hillary Clinton and Donald Trump are seen during the 42nd Annual Halloween Parade on October 31, 2015 in New York City.
Bilgin S. Sasmaz | Anadolu Agency | Getty Images
People wearing the masks of presidential candidates Hillary Clinton and Donald Trump are seen during the 42nd Annual Halloween Parade on October 31, 2015 in New York City.