Here is what we found: The market moved up during three elections in 2014, 2009 and 1998. In fact, in 2009, the market saw two upper circuits in a single day after the election results were announced. The election results in 2004 and 1999 pulled the stock markets down. The benchmark index fell by 11 per cent on the day election results were declared in 2004.
“General elections are supposed to happen every five years. And, since 1980, in last 34 years till 2014, we have seen all kinds of governments, including mixed governments and absolute majority government. Average GDP growth stood at around 6.2 per cent over last 34 years. And, if we keep that expectation in mind, elections do not matter much,” explains Sorbh Gupta. If our country grows at around 6 per cent every year, which government is ruling, does not matter much,” says Gupta.
Long term investors need not worry or change their strategy due to the general elections in 2019. Investors must follow a disciplined approach and stick.