United States presidential elections always occur in leap years, yet investor enthusiasm is often tempered. However, the significant rise in share prices on Wednesday following Donald Trump’s victory declaration marked an extraordinary reaction, fueled by his assurances of lower domestic taxes alongside increased tariffs on foreign imports.

Trump’s promise to reduce corporate tax rates, contrasting with the UK’s approach of escalating employer costs, is anticipated to improve the profitability of numerous American enterprises. Furthermore, if Trump implements his proposed tariffs—starting at a minimum of 10 percent on most imports and potentially soaring to 60 percent on Chinese goods—it could bolster domestic companies against foreign competitors.

Experts have differing views on the potential impact of these changes, debating whether they will spur inflation or if the excitement can sustain itself. Regardless, investors should brace for a period of volatility in the coming weeks and even years.

Historical data on the S&P 500 index—an extensive representation of American stocks—indicates that it typically yields only half as much return in the two years following an election compared to the two years preceding it.

Specifically, since 1950, the S&P 500 has delivered an average return of 12.8 percent during the first half of any given four-year presidential term, in contrast to a striking 25.1 percent in the latter half, according to findings by Fidelity.

This phenomenon may stem from the fact that presidents and the Federal Reserve aim to address tough economic challenges immediately following elections, thereby stimulating economic activity as elections approach.

The adage prevalent on Wall Street, “don’t fight the Fed,” lends some optimism here. Yet, long-term investors, such as myself, focus less on the political arena and transient stock market fluctuations and instead prioritize steady capital growth over time.

Take, for instance, the tech giant Apple (stock symbol: AAPL), which faced a challenging November when it reported a disappointing forecast, resulting in a significant drop in its market capitalization, despite achieving fourth-quarter revenues of $94.9 billion, marking a 6 percent increase.

Compounding the company’s challenges, renowned investor Warren Buffett revealed that he reduced his Berkshire Hathaway portfolio’s Apple stake to $69.9 billion in the third quarter, down from $178 billion at its height last year. At that time, Buffett praised Apple as a superior business compared to Berkshire’s major stakes in American Express and Coca-Cola.

Buffett’s shift in strategy reflects a broader approach of divesting shares to enhance Berkshire’s cash reserves as a hedge against anticipated tax hikes due to the federal government’s budget deficits.

This development raises concerns for me as a small investor since Apple constitutes a major part of my portfolio, valued at a low six-figure sum, making up approximately 8 percent of my overall savings. For context, Apple represents 4.3 percent of the Morgan Stanley Capital International All-Country World Index.

While I hold immense respect for Warren Buffett’s insights, I do not intend to divest my Apple shares despite the latest market shifts. Notably, I managed to sell a portion of my shares at $225 in September for personal financial needs, having initially acquired them for about $23.75—adjusting for a subsequent four-for-one stock split—in February 2016.

Additionally, to raise cash, I sold ten percent of my McDonald’s (MCD) shares for $301, having bought them at $95 in July 2014, and similarly reduced my stake in tractor manufacturer Deere (DE), acquired at $82 in November 2013, which I sold at $407. Apple, McDonald’s, and Deere remain my top investment priorities.

I acknowledge that I am not equipped to time the market accurately; I firmly believe in the strategy of remaining invested over time. Many of my largest investments span over a decade. Moreover, I appreciate that I am only managing my investments as a small individual investor, unlike Buffett, who oversees billions on behalf of others.

No matter what policy directions Trump pursues, I find reassurance in diversifying my investments internationally to mitigate risks. While I empathize with those who have missed out on the remarkable growth of the U.S. economy, it is crucial not to overly depend on previously successful investments that many index funds tend to favor.

As we conclude, note that the addition of an extra day every four years to align the calendar with the solar cycle does not inherently signal an impending stock market adjustment. Nevertheless, past trends suggest that investors should remain vigilant for such corrections. While presidential candidates may present grand visions, the practicalities of governance often differ.

Potential Upsides from Trump’s Policies

Smaller American companies may experience significant gains as Wall Street begins to factor in the advantages of protectionist policies for domestic-focused businesses. Alongside discussions of a wall on the Mexican border, the introduction of significant tax barriers against imports could be beneficial to smaller corporations.

A case in point is the investment trust JPMorgan US Smaller Companies (JUSC), whose shares surged 9 percent following the election results. I have held investments in this trust for over a decade, having moved my shares from a paper-based broker in March 2014 when they were valued at £1.50.

Currently, JUSC shares are trading at £4.54, but stand 11 percent lower than their net asset value. The underlying companies may not be household names; however, this £305 million diversified portfolio has yielded a total return of 27 percent for the year and an impressive 174 percent over the decade.

The anticipation of new leadership in the world’s largest economy has also positively influenced the Edinburgh Worldwide (EWI) investment fund, focused on smaller companies worldwide. Its largest holding is Elon Musk’s Space Exploration Technologies, accounting for nearly 12 percent of EWI’s £732 million portfolio.

Musk’s vocal support for Trump’s re-election campaign may bode well for both him and SpaceX moving forward. Although it’s still early, I’m satisfied to have purchased EWI shares at £1.52 last January, as they are currently valued at £1.69.

Even Fever-Tree (FEV), the tonic water producer based in western London, saw a 5 percent rise in value, attributed to increased demand in the U.S. compared to the UK, alongside a stronger dollar making the company more attractive for potential American buyers.