When is the next general election?
The next general election is scheduled to take place on the first Thursday of May in 2024.
Could an election happen sooner?
A general election could happen sooner than May 2024, in which case it will be referred to as a snap election. For this to happen, two thirds of the members of parliament (MPs) would have to vote in favour of a general election, or Boris Johnson would have to lose a confidence motion.
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What to watch out for during a general election
- Watch the polls: The polls do not always get it right, but they are the best barometer to measure the public’s voting intentions. It is best to track as many polls as possible, because the findings from one can be very different to another
- Keep track of sterling: Sterling will be influenced by which party is forecast to win – with pro-business parties likely causing sterling to rally, and pro-regulation parties causing a possible run on the pound
- Read each party’s manifesto: You should consider what each party will do domestically if it wins. You can do this by studying manifestos and the effect pledges will have on the financial markets or those particular sectors
- Consider safe havens: Safe havens can help to protect you against increased volatility during an election. Assets that are often considered safe havens include commodities and currencies such as gold, the Japanese yen, and the Swiss franc
How do general elections affect UK markets?
General elections affect UK markets in different ways depending on which party is expected to win. If forecasts have the winner as a party which is seen as pro-business, then there will often be a rise in the markets in the build-up to the day of the election. If pro-regulation parties are forecast to win, then the markets will often fall.
How to trade a general election
You can trade an election by speculating on markets such as indices, shares and forex pairs. The FTSE 100, GBP/USD and UK stocks all tend to move in the run-up to an election, and often continue to move in the fall out of the result – meaning there will likely be opportunities to profit from the next UK general election.
CFDs and spread bets enable you to profit from markets that are rising or falling during a UK general election. This is because with these financial derivatives, you can speculate on the price of an asset without taking direct ownership of it.
However, if you prefer to buy stocks outright, you can do so with our share dealing service. Owning shares enables you to profit from increasing share prices, as well as through any dividend payments issued by the company.
To prepare yourself to trade the next general election, follow the steps below:
- Create a live IG account
- Carry out a fundamental and technical analysis of the market you want to trade
- Take steps to manage your risk
- Open, monitor and close your position
Not quite ready to start trading? Create an IG demo account to practise with £10,000 in virtual funds.
1 Based on revenue excluding FX (published financial statements, June 2020); for forex based on number of primary relationships with FX traders (Investment Trends UK Leveraged Trading Report released June 2020).