Effects of Trump's tweets on the market

[yankees60]

Trump Tweets, Markets React

https://www.fa-mag.com/news/trump-tweet ... 51264.html

"The ongoing trade spat with China is an example. It began in early 2018, has lingered like a bad cold ever since, and this summer escalated to dangerous levels. It’s natural to assume that Trump’s tweets about this kerfuffle can influence market moves, but do they really?

To find out, Scott Ladner, chief investment officer at Horizon Investments, and his team analyzed all the president’s tweets from January 2018 through this year’s first half and zeroed in on three key words: “China,” “trade” and “tariffs.” They used the S&P 500, the China A shares market and the VIX as proxies for the market and measured market reactions on the day the tweets came out. On days when the tweets were issued after the markets closed, the Horizon team looked at the next day’s trading activity."

"Ladner says the takeaway from all this is that the market cares when the president communicates about all three of these things, and it’s something to watch for. “In terms of how advisors might react to this, it heightens a need toward engaging in some protective strategies if you have dynamic aspects of portfolios that can react to incoming news,” he says. “We’re in a market now that’s more reactive to news than most markets in the past 10 or 15 years. It’s a very headline-driven market, and you can proxy that with the president’s Twitter feed.”

Perhaps Ladner should next turn his attention to how the market reacts when the president tweets the words “Powell,” Federal Reserve” and “incompetence” together."

Vinny

[boglerdude]

Make insider trading legal, to make it obvious that trading is a bad idea.