2024 elections: policy shifts and portfolio construction views

Investors around the world have been highly attuned to the unprecedented 2024 election season due to the scope of the global backdrop, mounting geopolitical turmoil and a late season shift in U.S. presidential candidates. To help our clients make sense of the election drama and potential policy implications, the Global Investment Committee at Nuveen — together with insights drawn from our investment teams, our Government Relations group and other investor education teams — discusses key areas to watch, presents policy scenarios for different outcomes, and shares our views about attractive opportunities across asset classes heading into (and out of) election season.

Key takeaways

• The election season could provide an additional catalyst for cash investments to underperform. We think investors should consider moving out of cash and allocating into select areas of fixed income.
• U.S. tax, spending and regulatory policies could look very different depending on election outcomes, likely driving some differences between relative asset prices.
• We think investors should plan now for potential U.S. tax increases. This could mean focusing more on tax-loss harvesting and emphasizing areas such as municipal bonds and real estate.
• Many investors are concerned that the U.S. Inflation Reduction Act (IRA) could be significantly scaled back, but its broad popularity across both red and blue states makes that unlikely

Looking ahead, the political environment can and most likely will affect global financial markets, but economic fundamentals and valuations remain more important. Regardless of the political backdrop, we expect many established trends to continue: moving out of cash into more attractive opportunities; the value of environmental, social and regulatory factors in driving investment performance; and the need for rigorous portfolio construction focused on solid research, high conviction and flexibility.

Nuveen’s Global Investment Committee will continue focusing on how these issues affect our investment approaches and our clients’ portfolios. Stay tuned for our fourth quarter outlook coming in October and our 2025 year-ahead forecasts in December.