How Midterm Elections In The U.S. Can Impact Your Investments And What To Do About It

We all hope voters will elect the best individuals, parties, and special interest groups, while overwhelming amounts of news oversaturate the nation. On the other hand, there is a harsh reality that political parties do what is necessary to stay in power and we can only hope this is what is best for American businesses and citizens. At present, a lot of government policy is impacted by special interest groups.  

If you want to reduce the political angst, you should consider a more stable environment for your assets. Move a significant part of your investable assets to a firm that provides wealth management in Switzerland.  

Even though you can’t predict the outcomes of the midterm elections, you can increase the percentage of your assets that is invested outside the U.S. in a global portfolio. There are additional benefits when you select a U.S. registered wealth manager that is based in Switzerland. 

Individuals and families are considering new strategies for investing their assets in 2023. 

Based on current economic conditions in the U.S. there is increasing talk of a deep, longer-lasting recession that is caused by 41-year high inflation, supply chain issues, geopolitical turmoil, and rising interest rates. The midterm election won’t fix those problems overnight, but the results could reduce the risk of further damage to the economy and U.S. businesses. 

Here’s what to watch for:

• Is the stock market a leading economic indicator?
• What does history tell us about the impact of elections on the securities markets?
• How will midterm elections impact the future performance of the markets?
• How can global investment management protect my financial interests?
• How does diversification reduce my risk of large losses?
• Why is global management – a better way to invest your assets?
• Why do so many families invest in global portfolios?
• Why are families using a Swiss-based firm for global investing?

Many investment professionals believe stock markets are leading economic indicators. If they are correct, then the current pricing of individual securities already reflects what is going to happen in the next six months.   

Which political party will dominate congress for the next two years? Will their policies be dominated by their more radical factions? How will their policies impact the profitability of U.S. companies in the future? Will future political decisions be based on what is best for the American public or the special interests that funded their elections?

The fact that no one knows the answers to these questions is a good reason to consider investing a portion of your liquid assets with LFA, a global wealth manager based in Switzerland. 

Wall Street likes Gridlock in D.C. Politicians can’t do any damage if they can’t agree on new regulations. This is what happens when one party has the presidency, and the other party controls the decisions that are made by congress. In general, gridlock can be a stabilizing force because outcomes in Washington D.C. are more predictable for the analysts following company stocks.

Conversely, if one party controls the presidency and congress, it’s easier for bills and budgets to be passed that suit their donors and constituencies. One of the clearest political choices in the U.S. is a return to energy independence. This is the difference between what is best for mainstream Americans and the economy 

Experienced Swiss wealth management firms like LFA understand the patterns of economic and political cycles. It is this data, backed by in-depth market research and monitoring, that helps us develop investment strategies that can work for you now and in the future

Consider protecting your hard-earned assets from record-high inflation levels and the potential for a severe recession by using LFA’s global wealth management services that are based in Switzerland. By moving a significant portion of your net worth outside the States, you could reduce your exposure to U.S stocks and the performance of the U.S. dollar. You preserve the purchasing power of your assets and reduce your exposure to the U.S. securities markets. 

And it is worth mentioning that by diversifying your assets in the global securities markets, you can invest in the best companies in the world because you are not limiting your investments to companies that are headquartered in the U.S. 

If you are thinking about moving a portion of your liquid assets outside the U.S., consider Switzerland for its long-term stability, global capabilities, and top-quality financial services. LFA is an independent wealth management firm that is custom tailored for individuals and families who live in the U.S. Our clients benefit from our extensive experience and network of partners, including several Swiss banks, estate planners, international law firms, CPAs, and other cross-border private client services. 

LFA is a prominent Swiss wealth manager that works for American investors seeking to diversify part of their wealth outside the U.S. securities markets. 

Experienced investors know the best way to reduce risk is to increase diversification. You are spreading your risk over a bigger base of investments, both domestic and international:

• Bonds, stocks, and cash equivalents
• Sectors of the economy: Energy, technology, utilities, etc.
• Value and growth stocks
• Alternative investments

Many of the best companies are headquartered in the U.S. and derive the majority of their earnings from outside the U.S. Other companies are headquartered outside the U.S. and derive most of their earnings from inside the U.S. Locations of headquarters do not really matter in a global economy. “Global investing” is the future.

With an increasing percentage of the world’s stock market capitalization outside the U.S., international diversification is key to accessing global investment opportunities. 

Limiting your investments to the U.S. means you are missing out on opportunities in Europe, Asia, and other parts of the world. Your consumer purchases are a key indicator of the global economy when you drive a German car and wear a Swiss watch. 

Why should your investment portfolio be any different? Invest in the best companies in the world instead of limiting yourself to just one country.  

According to an FXSSI report, the Swiss franc is the most stable currency in the world. This should not be a big surprise when you consider:

• The Swiss have an extremely strong economy
• A highly developed banking system
• The average inflation rate has averaged 0.6% for several years

It’s safe to say that a long-term stable environment is more important than the midterm election results in the U.S. But when the U.S. business environment is reeling, it may be in your best interest to invest part of your assets outside the country. Simply put, there are safer places to invest your assets, in particular, assets with longer investment horizons. 

Switzerland remains a global contender as one of the wealthiest per capita countries in the world. The stable Swiss franc is supported by a thriving economy, a disciplined central bank, political stability, and a balanced budget. These are the characteristics that make Switzerland more of a safe haven compared to other economies and currencies.

These characteristics can color a well-balanced environment for as much of your assets as you wish.

It may be time to diversify your assets into Swiss francs and global investment opportunities.

A winning combination can be expert global management combined with a stable currency. If you feel pressure to diversify your holdings, it’s time to explore the services of a Swiss-based firm that invests in the global securities markets. 

You may already know many of the best investment opportunities are headquartered outside the U.S. even if they conduct most of their business inside the U.S. It is getting increasingly difficult to analyze companies based on where they are headquartered because that may have little or nothing to do with where they derive the majority of their earnings.  

If you have concerns about what’s happening politically within the U.S. or feel threatened by the U.S. government’s rapidly rising debt that is already in excess of $30 trillion, you should consider a global portfolio and Swiss francs for your currency. 

It is a common business practice for more affluent, U.S.individuals and their families to rely on global wealth managers to invest their assets. It should be a source of comfort when a Swiss-based investment firm is your advisor. You too can feel safer knowing that a portion or all of your liquid net worth is managed by a Swiss team that can diversify your assets into a global investment portfolio with the best companies (no limitations based on geography).

As one of Switzerland’s leading independent wealth managers, we use our own specialized knowledge along with our partners to provide a sophisticated array of tailored financial advice and services. You benefit from the high-quality planning of a global investment manager based in Switzerland.

Don’t let the political circumstances in the U.S. create unnecessary worry. You have lots of options to consider. You can limit your options to U.S. managers and investments or you can use the services of a Swiss based wealth manager to expand into the global markets. 

Talk to LFA, a Swiss-based wealth management firm about global strategies that align with your financial goals and tolerance for risk.

We are a Swiss-based firm that works for Americans. Our dedicated personal relationships are based on expertise, trust, confidentiality, and loyalty. This is the heart of the relationship that Swiss firms have with their clients. Request an introductory call to learn more!

Talk to LFA about diversifying your holdings into Swiss francs and global investments.