JPMorgan released a list of stocks that could benefit from midterm elections. They get paid to do this. Someone wrote the report. Someone else edited it. A compliance officer reviewed it. Then they sent it to clients who manage billions of dollars.
The premise is simple. Vote counts change. Policy shifts. Stocks move. Except policy doesn't shift because nothing passes anymore and stocks move based on whether Jerome Powell coughed during a speech or some algorithm detected the word "tariff" in a tweet from 2019.
But sure. Let's pretend gridlock versus slightly different gridlock matters for your portfolio. Let's pretend the party that wins Montana's Senate seat will determine whether defense contractors outperform utilities. Let's pretend you can trade this information faster than the guys who got the JPMorgan note forty milliseconds before you did and already front-ran your pathetic limit order.
The report probably includes a healthcare stock because one party wants to regulate pharma and the other party also wants to regulate pharma but says they don't. It definitely includes an energy stock because one party loves oil and the other party loves oil but feels bad about it. There's a defense name in there because wars are bipartisan. There's probably a bank because Jamie Dimon needs to make the list or he'll fire someone.
Retail traders will read this headline and think they found an edge. They'll buy three shares of whatever gets mentioned on CNBC. They'll check the price seventeen times before lunch. They'll watch their position go red because the entire thesis was cooked up by an analyst who needed to publish something before quarterly reviews and the midterms were simply nearby on a calendar.
The elections will happen. The stocks will do whatever they were going to do anyway. JPMorgan will collect fees regardless.
Democracy is beautiful but your stop loss doesn't care who controls the House.
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