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| The indicators are mixed on the question of which Presidential Party is best for AOL investors. Two theories compete as to the influence of the President's political party on stock prices. One camp holds that the market reacts very to the choice of president, possibly even before election day when the outcome is forseen. Others believe the new president does not begin to materially influence the market until he has been in office for some time. |
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| Monthly Appreciation is calculated as the percentage change between the mean price of each month compared to the preceding month. Price Periods are assigned to Political Parties three different ways for this calculation. The indicators are not in total agreement here for AOL investors. But two of the three favor the Democrats. |
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| You may have seen charts that profile seasonal trends. This is similar, but it is based on the political calendar. The short (Congressional) cycle is 24 months long. AOL shows the typical election cycle pattern, with the worst months shortly before elections, reflecting the uncertainty. We believe that the well known "September Slump" is actually due in large part to the pre-election dip. |
More Political Analysis including Congressional Cycle and Indicator Roadmap |