Senators vs Santa’s Reindeer: 2020 Stock Picking Roundup

22 Pages Posted: 21 Dec 2020

See all articles by William Belmont

William Belmont

Dartmouth College

Maxwell Grozovsky

Dartmouth COllege

Bruce Sacerdote

Dartmouth College - Department of Economics; National Bureau of Economic Research (NBER)

Ranjan Sehgal

Dartmouth College

Ian Van Hoek

Dartmouth College

Date Written: December 18, 2020

Abstract

Given the concerns over informed stock trading by U.S. senators and congresspeople at the beginning of the COVID pandemic, we examine these legislators’ short term stock trading results during 2020. We find little evidence for market timing or stock selection ability. Both Senators’ and House Members’ stock selections underperform the S&P at the one month horizon and underperform a size-industry adjusted benchmark at the 3 and 6 month time frames. Returns to legislators’ purchases contrast with returns to the top stock picks from U.S. brokerage houses and stocks chosen by Santa’s Reindeer (Santa’s Village Jefferson NH). As a group the Reindeer outperform the S&P by 4.89 percent in a single month, or over 70 percent on an annualized basis. However reindeer exhibit herding behavior and a preference for momentum stocks.

Keywords: Stock Trading, Stock Selection, Reindeer, Senators, Congresspeople

JEL Classification: GOO

Suggested Citation

Belmont, William and Grozovsky, Maxwell and Sacerdote, Bruce and Sehgal, Ranjan and Van Hoek, Ian, Senators vs Santa’s Reindeer: 2020 Stock Picking Roundup (December 18, 2020). Available at SSRN: https://ssrn.com/abstract=3751711 or http://dx.doi.org/10.2139/ssrn.3751711

William Belmont

Dartmouth College ( email )

Department of Sociology
Hanover, NH 03755
United States

Maxwell Grozovsky

Dartmouth COllege ( email )

Department of Sociology
Hanover, NH 03755
United States

Bruce Sacerdote (Contact Author)

Dartmouth College - Department of Economics ( email )

6106 Rockefeller Hall
Hanover, NH 03755
United States
603-646-2121 (Phone)
603-646-2122 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Ranjan Sehgal

Dartmouth College

Department of Sociology
Hanover, NH 03755
United States

Ian Van Hoek

Dartmouth College ( email )

Department of Sociology
Hanover, NH 03755
United States

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