The results are in, and the winner is . . . Optimism?

Fear, uncertainty, and unrest have undoubtedly been the major headlines of 2020 to this point, and rightfully so, but is there any reason for optimism? During our Q3 macroeconomic presentation, we presented data that we believe show signs of positivity in what has otherwise been a year full of gloom. Interestingly enough, that slightly positive sentiment was shared by the majority of the audience that viewed our presentation. We conducted a few short, anonymous polls in an effort to see how others viewed the current circumstances we are facing in this country, and the results were very interesting. Here is a quick look at the questions we asked, a little background information on each topic, and the polls' results. If you would like more information about these or any other topics, our recently published Q3 macro presentation is a great resource.

Question 1: Which S&P 500 sector has seen the best performance year to date?

Poll results: 61% said Information Technology

Answer: Information Technology

While the pandemic has created unprecedented market uncertainty and drastically affected many mainstay companies, it has also created an environment for more nimble companies to thrive. This is evident in the technology sector's performance, which is up almost 15% year-to-date. Companies in this sector proved that success could be found if management is willing to innovate and remain focused on consumer trends. This information should be encouraging for investors, knowing that pockets of value can be found even in the toughest markets. It is clear from the poll results that those who participated have noticed the technology sector's success despite the challenging circumstances.

Question 2: How do new home sales in September of 2020 compare to new home sales in September of 2019?

Poll results: 100% of the audience said that new home sales were up year-over-year

Answer: Up ~ 20%

Home sales are up almost 20% compared to last year. This boom in housing demand and spending is due, in large part, to low mortgage rates as well as increased savings (sounds crazy, but it's true), demand for larger homes in the "work from home" environment, and the trend of people moving out of cities. The fact that home sales could be up year-over-year is astounding considering the current circumstances, but almost equally as surprising is the notion that 100% of the audience expected that result. Assuming that any portion of the economy would be functioning at a higher level now than it was a year ago is hard to imagine, but the data confirms it, and our audience was well aware.

Question 3: Who do you think will win the 2020 Election?

Poll results: 53% said Joe Biden

Question 3b: Who will you vote for in the 2020 Election?

Poll results: 80% said Donald Trump

Obviously, it depends where you stand politically as to whether or not these results are positive or negative in your mind. Regardless of who wins the White House, having that variable removed will be one less unknown, which is usually appreciated by the market and a reason to hold an optimistic outlook moving forward.

Question 4: Are you better off or worse off than you were 4 years ago?

Poll results: 100% answered, "better off."

In the middle of a pandemic, 100% of the audience responded by saying they are better off now than they were 4 years ago. That’s definitely not the result we expected. The reasons that led to those responses are undoubtedly wide-ranging, and we are not insensitive to the reality that this would not be the case if this survey had been conducted on a national scale. Clearly, a large portion of the US is hurting and would not echo this same sentiment, but is it possible that for many of us, if we allow the dust to settle and can look past some of the headlines, we see that we are more fortunate than we realize.