In a television interview Monday, Fisher said the nine-month window after the U.S. midterm elections is historically the most profitable period for the Canadian stock market.
“The average yield for them [nine months after a U.S. midterm election] it is just over 17 percent. They were positive 91 percent of the time,” Fisher said.
“There has never been a negative nine-month streak on this streak in the history of the TSX. Just amazing facts.”
Fisher explained that midterm elections in the US usually cause political gridlock and are less likely to have controversial events, such as market prices.
There have been only two instances where the nine-month period following the US midterm elections did not produce positive returns, Fisher said. One was at the beginning of World War II and the other was before the Great Depression.
Fisher added that he doesn’t think Canada’s high inflation will change the historical trend of positive returns during the US midterm elections. He said the current environment is similar to the bear market of 1966, which was also characterized by high inflation and ended with an “intermediate miracle”.
If stocks rally after the Nov. 8 U.S. midterm elections, Fisher believes technology and consumer discretionary stocks will perform particularly well.
For more, check out the full interview with Fisher.
