Bespoke Investment Group has been publishing some nice research charts on the correlation between the US stock market today and past cycles.
Last week I went into detail about the Presidential Cycle and what it might mean for investors this year. (see The Presidential Cycle – How To Take Advantage In Your Portfolio)
The US stock market has traded inline with what one would expect when compared to the historic correlation:
However, the markets are also trading in a similar pattern to that of last year:
So which is correct? Unless someone has a magic crystal ball that I can borrow, only time will tell. But I do tend to lean towards correlations with more historic data points…