Several people have asked me over the past week what will happen to the stock market after the upcoming midterm election. Boy, do I wish I knew the answer to that one!

I may be an investment professional, but that doesn’t mean I can reliably predict where the market will move next. What I do have is a belief in the Efficient Market Hypothesis, which states that the markets reflect all the available information at a given time. That makes it extremely difficult to consistently predict what the market will do next.

Still, I can certainly understand why people are anxious about the election and its impact on the stock market. It feels like everyone is afraid that the sky is falling; half of the country if the Democrats take control of the House and Senate, and half of the country if the Republicans maintain control of them. Pretty incredible, isn’t it?

While I can’t tell you what the markets will do after the election—or, for that matter, tomorrow—what I can do is provide you with some evidence from over 75 years of market returns that may help put you at ease.

Per Fidelity, the S&P 500 index has posted gains in 95% of 12-month periods following midterm elections since 1938. In addition, the S&P 500 index has averaged gains of 14.5% since 1950 for the November-to-November period after the midterm election. That easily beats the long-term average gain since 1927 of just over 10% for the S&P 500 index and its predecessor, according to Investopedia.

Meanwhile, Blackrock notes that midterm election years themselves have been, on average, the worst-performing years for the stock market. Even so, since 1970, midterm election-year returns have averaged 7.5%.

So, what gives?

Markets don’t like uncertainty. Leading up to an election, it is often unclear whether control of Congress will change or how that might affect government policy. This uncertainty can contribute to higher volatility and lower market returns. Once the election outcome is clearer, either after the election or in the weeks leading up to it, investors feel more certain of the direction of government policy for at least the next two years.

Here is my final thought. Make sure that you are invested in a strong, diversified portfolio that makes sense for you for the long term, so that you won’t feel stressed leading up (or after) to the election. Consult a financial advisor if you are not sure. Avoid making any big changes based on emotions, knowing that the market has tended to perform well in the 12 months following midterm elections.

How ever you handle election stress, invest smartly and invest well!

Larry Sidney is a Zephyr Cove-based Investment Advisor Representative. Information is found at https://palisadeinvestments.com/ or by calling 775-299-4600 x702. This is not a solicitation to buy or sell securities. Clients may hold positions mentioned in this article. Past performance does not guarantee future results. Consult your financial advisor before purchasing any security.