What stocks difference a Trump’s month makes?


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Between USD 140 million and USD 11 billion could be the golden answer. Goldman Sachs’ Lloyd Blankfein, Icahn & Co’s Carl Icahn, Berkshire Hathaway’s Warren Buffett and many other billionaires-already have raked huge amounts of money since Donald Trump has been elected the 45th POTUS in contradiction with unanimous pollsters who predicted his Democrat rival Hillary Clinton’s victory.

The Dow (+10.62%), the S&P 500 (+8.3%), the Nasdaq (+4.4%) have all hit record highs again and again since November 7, 2016 with half of stocks having gained at least 10% and the Dow just a couple hundred points away from reaching 20,000 for the first time ever.

Such a rally has taken place on the assumption that Trump’s policies will be “asset-friendly and market-friendly,” said Blankfein and because it’s perceived that the Trump administration “is going to be a very pro-business presidency and government,” added Icahn, a longtime supporter of the President-elect.

However for Icahn who allegedly bet on a stock market crash in May 2016 and eventually won between USD 700 million and USD 1 billion since Election Day, the Trump rally in stocks may have gone too fast and furious. Indeed, according to FactSet, the current 12-month trailing price-to-earnings P/E ratio of the SP500 approaches 26 while the Shiller P/E stands near 28.

Stocks have been this expensive on just three occasions: in 1929, during the tech bubble and the 2007-2009 financial crisis.

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