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Stocks vs. 'safe havens': Two traders on whether gold, bonds are worth buying as election results roll in

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Trading Nation: How to trade the presidential election

Stocks, gold or bonds?

With the results of the U.S. presidential election still rolling in Wednesday afternoon, two traders weighed whether stocks or the traditionally "safe-haven" assets were better bets based on the potential outcomes.

Stocks and bonds climbed Wednesday despite the race continuing to tighten. U.S. Treasury yields, which trade inversely to bonds, traded lower, with the 10-year yield hitting a two-week low.

Gold, which is up for the week, fell on the prospects of the Republican Party maintaining control of the Senate. Many fear a Republican Senate and Democratic presidential victory would bring about a smaller fiscal stimulus package than anticipated.

"I think the bond market is focusing in on the smaller stimulus and that's why you're seeing 10-year yields fall," Steve Chiavarone, a portfolio manager, equity strategist and vice president at Federated Hermes, told CNBC's "Trading Nation" on Wednesday.

The stock market is likely focusing longer term on a lack of major policy changes including on the tax front and in the courts, Chiavarone said.

"Ultimately, to steal the old political phrase, I think this is a story about 'This is the economy, stupid.' And the economy is in recovery," he said. "That's good for risk assets, and it will continue to be good for risk assets regardless of what the eventual outcome is over the next couple days here with the presidential election."

Matt Maley, chief market strategist at Miller Tabak, said he agreed with Chiavarone that "stocks are the play, especially through the end of the year."

"The last six weeks or so of an election year are always positive," Maley said in the same "Trading Nation" interview.

As for gold's recent struggles, the metal may have leveled off because of its inverse correlation to the U.S. dollar, the strategist said.

"The big driver for gold has been the dollar. And right now, the dollar is still heavily shorted," which makes it difficult for the dollar to fall and gold to rise between now and year-end, Maley said.

"Longer term, I do like gold," he said, adding that once the dollar works off its short positions, "that'll allow gold to rally."

Citing the chart, he flagged two key levels to watch in the yellow metal, which fell less than 1% to around $1,898.50 on Wednesday.

"Even though people are looking at a descending triangle pattern right now on a short-term basis, look at 1,960 and then 2,000," Maley said. "Any break above 2,000 as we move into next year is going to signal another leg higher in what I think is a long-term bull market in gold. But right now, I'd want to avoid it."

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