US election: Backing the winner
We get under the hood of our funds and portfolios to find what the US election result could mean for our investment clients
4 min read
02 Dec 2021During the pandemic, UK charities have struggled to balance a massive shortfall in funding with an unprecedented increase in demand. How severe was the impact on the sector and how can we best support it? Victoria Papworth, Philanthropy Specialist at the Coutts Institute, shares her insights.4 min
28 Oct 2021What’s the reality of building a culture that champions equality and inclusion for our colleagues and clients? We explain how we’re moving forward on our journey to greater diversity.3 min
A brighter outlook, US resilience and diversification still key – our latest market views | Insights | Coutts19 Sep 2023Our experts updated Coutts’ clients on the latest macroeconomic news and how we’re managing their portfolios and funds at our recent event.3 min
19 Sep 2023By leaving your money invested for longer you could take advantage of compounding to help realise greater returns and potentially protect your wealth from volatility.4 min
As the day of the US election draws near, investors are reading the auguries to try and divine the potential result. While nothing's certain even at this late stage, it makes sense to consider the core scenarios that may impact markets and investors in the weeks ahead.
Right now, market behaviour indicates that investors are reasonably confident of a Biden victory. Betting odds – which are often a good indicator of conviction among people with money at stake – put the chance of a Biden win at 60%. (Source: Bloomberg/Predictit)
Rising bond yields (meaning lower bond prices) are one indicator that markets expect a Democrat victory. A Democrat president – particularly with the backing of a Democrat House and Senate – will swiftly introduce a generous government support package for people and companies affected by the coronavirus pandemic. This should lead to higher spending, improved economic growth and higher inflation, all of which are negative for bonds.
We can see that bond yields have risen as the odds of a Biden victory has improved. While the rise is modest relative to longer-term moves, it shows the market expectation that that the support package will be bigger than previously anticipated.
About Coutts investments
With unstinting focus on client objectives and capital preservation, Coutts Investments provide high-touch investment expertise that centres on diversified solutions and a service-led approach to portfolio management.Discover more about Coutts investments