Investors see higher taxes, delayed results but election winner by Dec. 8, Goldman says

Key Points
  • Investors in the options market are pricing for extended volatility after the election in part due to concerns there will be no clear winner immediately, but it appears investors expect an outcome by Dec. 8, according to Goldman Sachs strategists
  • The strategists also calculated that the market is pricing in 53% odds of an increase in corporate taxes, about the same level of odds prediction markets are giving to a Democratic sweep of the White House and Congress.
  • "The election matters for equities, and the outcome is highly uncertain," the strategists wrote.
Voters cast their ballots for the 2020 election at an early, in-person voting location in Arlington, Virginia, on September 18, 2020.
Andrew Caballero-Reynolds | AFP | Getty Images

Investors have been positioning for an extended period of volatility for days and months after the election and also the potential for a corporate tax hike next year that could hit tech, communications services and health care companies the hardest. according to Goldman Sachs strategists.

The stock market appears to be pricing a 53% chance for corporate tax hikes, nearly the same odds the prediction markets give a Democratic sweep of the White House and Congress, according to the strategists.