The writer is a former chief investment strategist at Bridgewater Associates
With a consequential US election only days away, investors and analysts have been increasingly asked how they are trading the event. Shifts in government policy after elections can obviously influence market and economic trends.
But correctly predicting changes in government policy and market reactions is far from straightforward, even if traders correctly call the highly uncertain outcome of this election. As always, timing is key even when there is a clear policy shift to trade on. When are policy proposals announced? How much is discounted in market valuations when proposals become reality?