Experts Explain: Where Should You Invest Your Money in a Trump Economy?
Written by
Yaël Bizouati-Kennedy
Edited by
Rebekah Evans
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We’re just a few months away from the presidential election and economic issues are top of mind for many. Just to name a few: stubborn inflation, soaring rates, a difficult housing market or the resumption of student loans. These are all weighing on many Americans’ minds — and their wallets.
And while the stock market has been on a roll recently, whether this will continue remains to be seen. Against this backdrop, how the elections will affect investment decisions and portfolios might be very different given the different views of President Joe Biden and Donald Trump, notably on trade, manufacturing and infrastructure, for instance.
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“Overall, the stock market has performed well under both Democratic and Republican presidents,” said Stephen Kates, certified financial planner (CFP) and principal financial analyst at Annuity.org, adding that he would not suggest making any major investment strategy changes based solely on who sits in the White House. “The President will have less direct influence on the stock and bond markets than the Federal Reserve policy or the overall national and global economic trends.”
Other experts chimed in about where to invest if Donald Trump were to be re-elected and how this could affect investment portfolios.
With all that in mind, here are five stocks that could soar with another Trump presidency.
A Widespread Deregulatory Campaign
If there is a future Trump administration and if that future Trump administration enacts policies akin to its former term, a few characteristics are likely to emerge, such as a rapid, widespread deregulatory campaign, according to Peter Earle, senior economist at the American Institute for Economic Research.
In turn, he said, this would impact industries that are the most subject to regulations: energy (such as oil and gas) and transportation (such as trucking and airline), in particular.
Infrastructure
According to Michael Collins, chartered financial analyst (CFA), founder and CEO of WinCap Financial, in a Trump economy, you may want to consider investing your money in infrastructure.
“President Trump has made it clear that he plans to invest heavily in infrastructure projects such as roads, bridges and airports,” Collins said, adding that in turn, this could present opportunities for investment in companies that specialize in engineering, construction or materials needed for these types of projects.
Energy
Another sector worth considering is energy, as Trump promised to increase domestic energy production and revive the coal industry, Collins explained.
“This could lead to potential investment opportunities in energy companies, particularly those focused on oil and natural gas,” he said.
Real Estate
Collins said that as a real estate mogul, Trump’s policies are expected to be favorable for the real estate market. As such, consider investing in rental properties or real estate investment trusts (REITs), he said.
“Ultimately, it is important to carefully research any potential investments before making decisions based on political circumstances alone,” Collins said.
Stocks That Will Benefit From Tax Cuts
According to Oliver Rust, head of product at economic data provider Truflation, some of the moves to protect and grow your money on the assumption that Trump does become President again include targeting stocks that will benefit from tax cuts, “given this was a focus of Trump’s first term in which saw a significant reduction in corporate tax it is likely that it will be another focus in a second term.”
“So keep an eye out for high tax paying companies,” he said.
Banks and Financial Service Stocks
Rust said this is another sector worth looking at, as Trump relaxed financial regulations put in place after the 2008 crises and the banking crises in March 2023.
“He could roll back the tougher capital and long-term debt financing requirements that are due to be implemented in 2025,” he said — noting, however, that significant deregulation of the banks has other risks, so this might not be a good fit for risk-averse investors.
North American Manufacturers
Based on Trump’s recent comments, he will continue to apply pressure on China and other foreign nations through the use of tariffs on imports, which in turn may provide benefits to North American manufacturers who may receive additional business, Kates said.
Yet, he also explained that any retaliatory tariffs may cause the acquisition of basic materials and input parts to become harder and more expensive.
“It is difficult to predict clear investment opportunities to take advantage of this potential policy because the exact nature of the tariffs, their scope, their targets and the downstream impacts are unknown,” Kates said.
Additional Potential Trends
Other experts, on the other hand, argued that investing based on politics or a president is not good advice. “Instead, let’s focus on trends that we may see over the next one to four years,” said Stoy Hall, CFP, CEO and founder of Black Mammoth.
First, Hall said commercial real estate will be worth looking at when interest rates settle back down.
Technology is also another sector of focus, buoyed by the boom of artificial intelligence (AI) and a massive expansion in its use cases, Hall explained. “I believe you will see more efficiencies from companies and more innovations pop up thus leading to some potentially great returns,” he said.
Finally, he added that healthcare is also of note. “With the use of AI but also innovation, in general, I believe we will see a few more breakthroughs in the healthcare sector — from treatments [and] medicines to efficiencies in the system, stay tuned in this sector,” he said.
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