Dear Readers, Heading into last week's US elections, the bull case for stocks seemed to be "Blue Wave or bust." The thinking there was that a fully Democrat-run government would quickly usher in a big chunk of much-needed stimulus and send risk assets soaring. But then, as the results started came in — and a Republican-controlled Senate crystalized as the most likely outcome — a sharp shift occurred. Suddenly a divided government was viewed as the best possible outcome for markets. The speed at which Wall Street talked itself into its new reality was astounding. Bolstered by their new positive rationale, stocks soared in the election's immediate aftermath. But under the market's surface, the shift wasn't so simple. Although most investors remained directionally bullish, they rotated out of certain trades in favor of other, more appealing ones. It ultimately amounted to a reshuffling of market dynamics — the type of shifting sands that wise investors can see and capitalize on. If you aren't yet a subscriber to Insider Investing, you can sign up here. Right off the bat, the Investing team at Business Insider interviewed three veteran investors to figure out how to build a resilient long-term portfolio designed to thrive in a gridlocked government. We also heard from a team of Wells Fargo experts how to best play the stock, bond, and commodity markets, as well as taxes. On the subject of a divided government, an advisor at the world's largest wealth manager broke down why a Biden win and a split Congress is the best long-term outcome for markets. The investment chief at Raymond James took it a step further and detailed four sectors poised to thrive no matter what under such a scenario. And for those simply looking to trade short-term market volatility and protect their portfolios in the long term, we spoke to a UBS investment chief for the best approach there. For more, see below Business Insider's best Investing stories of the week, which include a wide array of additional recommendations, strategies, and tips for navigating uncertainty. Thanks for reading! -- Joe It will offer a daily roundup of the top news and analysis from D.C. and beyond. Click here for more details. And sign up here! Willie Mandrell, the owner of The Mandrell Co. and founder of Wealth Builder Nation, learned the art of real-estate investing from his grandmother. After she turned a series of initial multifamily purchases into a real-estate empire, Willie did the same. To come up with cash for his first down payment, Mandrell worked a series of odd jobs, including stints at Outback Steakhouse, McDonald's, and Marriott. He now oversees 40 units in Boston. Read the full story here: Rob Emrich is the founder of the $411 million Acruence Capital, which offers various option overlay and volatility-hedging strategies. The firm's volatility-capture program, which helps dampen volatility in its clients' portfolios, was up more than 3,700% in March at the depths of the stock-market crash. Emrich is now suggesting that VIX could hit 125 in the next four to six months, given an unexpected catalyst that could be related to the elections, COVID-19, or geopolitical risks. He shared how investors could take advantage of this level of volatility and mitigate risks in their portfolios. Read the full story here: Andrew Left of Citron Research walked Business Insider through the stocks he's buying and betting against today. One of his newest buys is a company he called an enormous fraud last spring. He now says Jumia has fixed its major issues. Citron Capital, Left's hedge fund, says it's up 75% in 2020 after subtracting fees. Read the full story here: Stock pick central Seeking experts who are willing to name names? Look no further: Quote of the week "The market loves deadlock. Everybody doesn't necessarily like massive change; certainly market participants don't because it becomes harder to forecast what that change will do to the economy and to companies." -- Tom Mantione, a managing director for UBS private-wealth management, shedding some light on why a divided government is positive for stocks |
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