Scott Rothbort, term professor and chief market strategist at the Stillman School of Business, was featured in an online article published in Forbes magazine on Nov. 1.
Rothbort discussed the potential impact of both the presidential and congressional elections on the financial markets.
“I wanted to be objective. I wanted to find out how the markets respond to presidential elections,” Rothbort said. “I looked at it from the point of view that we had a nationwide election; I was going to determine who the president was going to be.”
Rothbort, who is also the founder and president of Lake View Asset Management, is no stranger to big name media outlets.
Having been on networks like CNBC, Fox Business News and Bloomberg TV and Radio, Rothbort has given finance insight like this before. With the help of Seton Hall’s media team, he was able to pitch his ideas and have them picked up by Forbes. It all started with a theory.
“I thought that labor employment numbers could be an indicator of how the election was going to turn out, but I realized that this was a different election,” Rothbort said.
Realizing how unique this particular election was, he wanted to be more objective in his research. With a new angle, Rothbort started to look at how the markets responded to an election and what the outcomes would be. Through probability-weighted conclusions, he determined the outcomes and provided his opinions in Forbes on how the market would react to it.
The article was a comparison of a Donald Trump presidential win versus a Hillary Clinton presidential win, and what that would mean for the market economy, which is exactly what Rothbort looked at in his research. Overall, it noted that a Clinton presidency would be “business as usual” for the market, while a Trump presidency would leave more unpredictability.
Given how the markets dropped immediately following the election and then rallied, the Forbes article was accurate in its predictions about volatility. Rothbort also was not surprised by the response saying, “I’ve seen this movie before.” The ‘movie’ he was referring to was in terms of behavior, Dow Futures in particular.
“The futures market is very illiquid, anybody who is a market professional knows to take it with a grain of salt,” Rothbort said.
Fatima Munir, a junior finance major, observed that it was not just the level of unpredictability investors were afraid of during the election.
“Trump’s behavior is what affected the international and national markets,” she said. “Mexican currency rates dropped right after he was elected.”
Ekta Ray, a sophomore business major, speculated that the distrust the international markets had for Trump contributed to the drop.
Additionally, Rothbort noted that since the markets have been able to engage in a period of relief, America is in fact not at the end of days. Through his assessment of research, Rothbort predicted a relief rally after the election. By relieving the uncertainty of who would be president, the market would be able to get back to normal. Not only was this prediction a featured point in the article, but it is something he pointed out that came to fruition.
“Despite what market pundits said, the world was not ending if Donald Trump or Hillary Clinton were elected,” Rothbort said. “And, as we found out, the world is not ending.”
Megan Beauchamp can be reached at firstname.lastname@example.org.