Part of our midterms guide. Start here: what the vote really changes for your money.
What Does Everyone Already Know?
On Monday, the Nasdaq 100 closed more than 10% below its Oct. 6 peak: a correction, its third this year. On Wednesday, after Democrats won Congress, the Dow rose 3.03% to 53,356, its best day since April 2025, and the S&P 500 rose 1.58% to 7,689.
Correction on Monday. Rally on Wednesday. Can you predict which one wins next week? Probably not. Nobody can, not reliably. But you can decide now what you’ll do either way.
What Does The Data Say?
That this wasn’t one market. It was two, moving in opposite directions at the same time. Look at Wednesday alone:
| Stock | Nov 4 | Before the vote |
|---|---|---|
| Centene (CNC) | +12.6%, to $76.01 | +96% over 12 months |
| HCA (HCA) | +10.3% | +1% over 12 months |
| Vistra (VST) | −13.8%, to $120.29 | −27% over 12 months |
| Vertiv (VRT) | −12.9%, to $205.55 | Up 5-7% on Nov 3 |
| GE Vernova (GEV) | −9.3%, to $832.83 | Up 5-7% on Nov 3 |
| Lockheed (LMT) | −6.9% | +26% in a month |
| Nvidia (NVDA) | −3.2%, to $200.13 | −12% in a month |
On the Dow’s best day since April 2025, power stocks fell 9-14%. “The market” told you nothing about your stocks.
And the AI selloff kept going underneath the rally. In the month to Tuesday, AMD fell 24%, Micron 20%, Alphabet 18% and Dell 27%. On Wednesday, Micron fell another 7%. Meanwhile Centene, Wednesday’s winner, was already up 96% over 12 months and just 5% below its 52-week high before the vote.
See more lines: why the two markets moved apart
The vote moved stocks on what a Democratic Congress might do in 2027: health-care money back (insurers and hospitals up), a smaller defense budget (defense down), scrutiny of AI data centers plus a Texas governor who wants to pause new ones (power and data-center builders down). None of those changed a single company’s earnings on Wednesday; the new Congress isn’t sworn in until January, and President Trump keeps his veto. The AI selloff is older and is about something else: whether roughly $900 billion of AI spending worldwide this year earns its money back. We’ll score our own pre-vote calls in a day-after recap.
So Why Does This Feel So Hard?
Because fear and greed arrived on the same day. If you own Vistra, Wednesday felt like a crash. If you own Centene, it felt like a windfall. Both feelings push you to act on the price, right now.
We wrote about this frame in October, when inflation was the fear: Inflation Is Back. Is A Stock Market Crash Next? The point then holds now. Crashes happen: in 2022, the S&P 500 fell 25% from its January high, Nvidia fell 63% and Meta fell 74%. And recoveries happen faster than people expect: after the 1982 low, the S&P 500 rose 58% in a year. Often, the investors who got hurt most weren’t the ones who owned the wrong stocks. They were the ones who had to decide what to do in the middle of the move.
What Should You Do This Week?
Write the plan now, on a calm night, for every position you care about. Three lines each.
1. What you buy at −10% and −20%. Take Nvidia, about $200 at Wednesday’s close. Ten percent lower is $180; twenty percent lower is $160. You can place limit orders at those prices. Or, if you’d want the stock there anyway, you can sell cash-secured puts and get paid to wait:
- A $180 put expiring Feb. 19, 2027, about three and a half months out, paid about $8.25 a share at Wednesday’s close (midpoint of the bid and ask), an effective entry near $172. Per contract you set aside $18,000 and collect about $825.
- A $160 put with the same expiry paid about $3.88, an effective entry near $156.
The risk: if Nvidia falls to $130, you still buy at your strike, and you’ll be sitting on a loss on day one. That’s why the size of each rung should be an amount you could hold through a further 30% fall.
2. What you trim at +20%. Pick the number before the rally does it for you. Centene closed Tuesday at $67.48; 20% above that is about $81, about 6.5% above Wednesday’s close. Put a limit sell for part of the position there, or trim back to your target weight if Wednesday already pushed it over. The risk: if a health-care deal comes early in the debt-limit talks, you sold some upside.
3. Which losers you sell before Dec. 31. A down year in a stock you’ve given up on is worth something at tax time. Over the 12 months to Wednesday’s close, Oracle is down 49%, Coinbase 51%, Robinhood 36%, Strategy 42% and Nike 32%. Selling a losing position in a taxable account books a loss that can offset gains, plus up to $3,000 a year of ordinary income ($1,500 if married filing separately), with the rest carried forward. Mind the wash-sale rule: if you buy the same or a substantially identical security within 30 days before or after the sale, the loss is disallowed for now. Wait 31 days or move into something genuinely different. Dec. 31 is a Thursday; the trade has to be done by then. The risk: the stock rebounds while you’re out of it.
This is education, not personal advice; options aren’t right for every account, and taxes depend on your situation.
What’s The Bigger Idea?
We call it Fear is a planning mistake. If a 14% drop in one day makes you want to sell, the position was too big, or you never decided in advance what you’d do at that price. The fix isn’t nerve. It’s paper: a written price for every action, set before you need it. Then a crash is a list of orders, and a rally is a list of trims.
How Does It End?
Usually better than it feels. Since 1985, about two in three Nasdaq Composite corrections stopped short of a 20% bear market, and after the index first closed in a correction, its median return over the next 12 months was about +24% (our count from index closes). This time the Composite itself stopped about 9% below its peak; only the Nasdaq 100 crossed into a correction. After the last 11 midterms, the S&P 500 was higher a year later every time. One in three isn’t zero, though. That’s what the −20% rung is for.
Write three lines per position tonight. A buy price at −10% and −20% (limit order or cash-secured put), a trim price at +20%, and a tax-loss list to act on before Dec. 31, minding the 30-day wash-sale window. This week’s split market, power down 9-14% while Centene and HCA rose 10-13%, is exactly when a plan beats a prediction.
What Should You Ask Next?
Follow this story with us: we’ll check these prices at Friday’s close and again at year end, and tell you which rungs were hit.
Is Your Plan Written Down Yet?
Elections change the odds, not your plan. If you have $1 million or more invested, see what Tuesday means for your portfolio in a free 15-minute call with a Trefis partner firm.
For questions about this article or underlying research, email help@trefis.com.









