It’s an election that has raised passions and galvanised voters on both sides of the US’s increasingly fractured political spectrum. With the ongoing Covid-19 pandemic, more than 70 million mail-in ballots have been requested. Every state has its own rules regarding the process and counting of mail-in ballots, which could delay the elections’ results for days. Adding to the uncertainty is the fact that a democratic victory in the Senate is by no means a given, despite Joe Biden holding a comfortable lead in the polls over incumbent Donald Trump. Biden needs to secure this victory in order to roll out his pro-labor and higher public spending agenda. Jeanne Asseraf-Bitton, Global Head of Market Research at Lyxor Asset Management, looks at the implications for investors.

If past elections provide any guidance, Trump re-election prospects look slim. History suggests that getting re-elected for a second term nearly always required strong growth. In most past election campaigns, polls didn’t materially shift after October. So far, polls between the two candidates keep on diverging with no example since 1980 of a candidate closing such a huge poll gap so close to the election.

According to Lyxor’s Money Monitor, ESG ETFs registered record inflows in September, and they now represent more than half of total cumulative ETF flows in 2020. Equity ETFs enjoyed good inflows last month, while fixed income ETFs were flat, as investors became increasingly concerned with stretched bond valuations and started to reduce position on corporate bonds. Follow the link to read the complete overview of flows in European open-ended funds and ETFs.