New research by Research Affiliates questions whether a Democratic presidency is really better for stock market returns.
The fact that the U.S. market has performed better under Democratic administrations isn’t disputed. Researchers have documented a statistically significant outperformance when a Democrat is in office going back to the 1920s.
The phenomenon is unexplained, and is known as the “presidential puzzle” by researchers.
But in a study published last week, Research Affiliates chalks it up to a statistical fluke.