What to buy and sell f the Democrats win

It is still too early to say, but the Democrats are expecting a victory in some states, which will lead to a mixed Congress. Given this, it is good to move from earliest to the winning sectors.

History shows that such a development of the mid-term elections has led to a decline in USD and a rise in the shares of firefighters. American Outdoor Brands Corp. and Sturm Ruger & Co. are two companies widely used to measure the political climate.

Democrats openly criticize the impact of the energy sector on the environment, while pharmaceutical companies, tobacco, mining, and airlines are highly regulated industries and are unlikely to benefit from enhanced democratic oversight. In particular, for the energy sector, we will probably see a strong Outflow, as the victory of the Democrats will come at an extremely awkward moment. To date, oil is almost 20% lower than the peak, and price outlooks are still negative. 10-year US bonds would also suffer as gold prices and strong dividends in the above-mentioned groups.

Source: Bloomberg Finance L.P.

Charts: Used with permission of Bloomberg Finance L.P.

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