US presidential election 2020

There aren't two choices this election - there are 17,000. Learn how you could trade the market volatility surrounding the US presidential election on our huge range of markets, plus find out how to hedge your portfolio and dollar exposure.

Start trading today. Call +65 6390 5133 or email accountopening@ig.com.sg. We’re here 24 hours a day, from Monday to Friday.

Contact us: +65 6390 5133

Start trading today. Call +65 6390 5133 or email accountopening@ig.com.sg. We’re here 24 hours a day, from Monday to Friday.

Contact us: +65 6390 5133

Tips for trading the US election

  • Set price alerts to notify you of significant movements before, during and after the election
  • Cap your maximum risk by placing guaranteed stops on your positions1
  • Trade on the go and react to breaking election news with our free trading app

During a presidential election, volatility will often spike if the result is uncertain or close-cut. If it’s clear that one candidate will be the outright winner, markets may be more stable. This is even more true if the incumbent is expected to be re-elected. So, you should keep up to date with the latest opinion polls to reduce your chances of being caught out by the result.

Why trade the US election with us?

Deal GBP/USD from just 0.9 points

Go long or short on a range of CFDs on currency pairs including all major USD, GBP and EUR crosses

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management

Protect your position from splippage with guaranteed stops. You only incur a fee when it is triggered.1

Choose from a range of price alerts

Stay informed of market movements with percentage and point-based price alerts – exclusive to our clients

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Enjoy low min commission from US$10 when you trade CFDs on US shares with us

When is the US election?

The US election is scheduled for Tuesday 3 November 2020, when all 50 states and Washington DC will cast their votes. The vote spans six different time zones, so the first exit polls will be available at around 11pm (EST) when West Coast voting closes. In the UK, that will be around 4am (GMT) on Wednesday 4 November 2020.

The election is likely to create opportunities for traders, with price movements expected across a range of forex pairs, indices and commodities in the run-up to polling day. Volatility related to the election could continue until congress certifies the result on Wednesday 6 January 2021, or even until the winner is inaugurated on Wednesday 20 January 2021.

To find out about significant movement as it happens, you can set alerts in an IG demo or live account.

How to trade the US election

  1. Select a market
  2. Open an IG trading account
  3. Be ready to react to US election news
  4. Log in and place your trade

You can trade the election by speculating on markets such as indices, shares and forex pairs. The US 500, GBP/USD and US stocks all tend to move in the run-up to polling day, and often continue to move in the fall out of the result – meaning there is opportunity to manage and trade the market volatility from the election.

CFDs enable you to speculate on the price of an asset without taking direct ownership of it. This gives you the flexibility to go long if you think an asset’s price will rise, or short if you think it will fall.

Open an account now

Open an account now

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Deal seamlessly, wherever you are

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Feel secure with a trusted provider

With 45 years of experience, we’re proud to offer a truly market-leading service

Open an account now

Open an account now

Fast execution on a huge range of markets

Enjoy flexible access to more than 17,000 global markets, with reliable execution

Deal seamlessly, wherever you are

Trade on the move with our natively designed, award-winning trading app

Feel secure with a trusted provider

With 45 years of experience, we’re proud to offer a truly market-leading service

Start trading now

Log in to your account now to access today’s opportunity in a huge range of markets.

Start trading now

Log in to your account now to access today’s opportunity in a huge range of markets.

How can you hedge risk during the presidential election?

You can hedge risk during the presidential election by opening positions that will might mitigate losses to assets you already own – such as currencies or stocks – should the market move adversely against you. With us, you can hedge against:

Dollar volatility

We offer over 80 CFDs on forex pairs including EUR/USD and GBP/USD, enabling you to insulate yourself from currency risk

24-hour trading

We enable you to go long or short on CFDs on FX and major indices markets 24/5, putting you at the heart of global action

Trade exclusive out-of-hour markets

Access pre-market and post-market trading hours and capitalise on announcements
with 70+ out-of-hours CFDs on US stocks

To start hedging, open a live account with us today. Or test out your theory risk-free in a demo account.

What should traders expect to see during the US election?

All US markets tend to experience increased volatility in the run up to a presidential election, including USD forex pairs, indices and commodities. That’s because many investors will attempt to lock in positions before the result is announced - using polls to gauge public sentiment. The aim is to take full advantage of the price moves that occur when the country’s political direction is confirmed.

At the top level, early indications suggest that the following could be on the cards if one of these two main candidates win:

Donald Trump

A Trump win could see an escalation of the trade war, potentially causing problems for some US exporters and having a negative impact on the value of the dollar.

However, this effect could be offset by reassurances that tax cuts and deregulation will continue – boosting the US economy.

Joe Biden

A Biden win could see tensions in the trade war cool, providing a boost to US exporters and the dollar.

However, these effects could be offset by tax increases for high-income households, and more limited deregulation.

Read analysis from IG Senior Market Analyst Joshua Mahony.

It’s also important to remember that the coronavirus pandemic is likely to create significant volatility over the election period. A spike in cases could see US indices and the dollar fall in value, as investors move to price in a reduction in consumer spending and economic output. Conversely, a reduction in the number of cases could see both indices and the dollar rise in value. Whichever way markets move, you can be ready to take advantage with an IG account.

Markets to watch

Here are some of the financial markets that are likely to be impacted by the US presidential election.

Forex

US dollar crosses, including EUR/USD, USD/JPY and GBP/USD are likely to be volatile – as investors move to price in the effects of the probable winner’s foreign policies.

Stocks and indices

US stocks and indices including the US 500 and Wall Street are expected to experience major price moves, with each candidate favouring a different approach to international trade.

Commodities

The prices of commodities including oil and gold are likely to fluctuate, in line with expectations for the country’s economic direction over the next four years.

Popular markets

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Prices above are subject to our website terms and conditions. Prices are indicative only.

How will markets react to the different candidates?

Market commentary by IG Senior Market Analyst Joshua Mahony

Stocks

Markets hate uncertainty, and historically the perception has been that a new president might bring policies that could be harmful for stocks. This happened in 2016 when analysts were confident that a Trump presidency would spark a market collapse.

But, we are now seeing that same fear creep in as people consider a Biden presidency and the potential uncertainty it could cause. Biden is openly more left-leaning, and his policies are expected to be geared towards human needs rather than those of investors and traders.

This sentiment isn’t helped by suggestions that Biden would reverse Trump’s tax cuts, and it is likely that markets will rise alongside the potentially increased chance of a Trump victory as we approach the election.

USD

The value of a currency is supposed to reflect the health of an economy and its future prospects. Many are expecting Biden to be less focused on the markets than his Republican opponent, so the dollar could weaken in the event of a Biden victory.

However, this effect could be offset if Biden is able to improve relations between the US and China after years of market anxiety. In this scenario, it would be the Chinese yuan which may benefit the most, with the trade war having sparked huge upside for USD/CNH.

Keep in mind that if the wider markets fall on a Biden victory – including US stocks and indices – the dollar would likely rally in the short-term to reflect a risk-off move as investors turn to USD.

Gold

The prospect of a more expansive fiscal policy under Biden, and from a government which is happy to embark on substantial spending programmes, could provide a boost to precious metals.

There’s a caveat here too, because in the past precious metals have also followed the same patterns as the stock markets during times of crisis. So, any collapse in equity markets that may come from a change at the White House could drag gold lower in the immediate period.

Plus, while Trump has finally seen the kind of stimulus he would have hoped for, a Biden win could result in a more substantial stimulus package if the Democrats gain a foothold in Congress.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

Choose IG as your out-of-hours trading provider

It’s free to open an account, and you don’t have to fund or trade until you’re ready.

1 A premium is incurred if a guaranteed stop is triggered

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