How Your S&P 500 Portfolio Would Look If You Started Investing On Inauguration Day 2021

Stock Market Performance Under Biden: A Three-Year Retrospective

When the 46th President of the United States took office on January 20, 2021, the financial markets entered a new chapter. The SPDR S&P 500 ETF Trust (SPY), a leading benchmark for broad market exposure, opened at $381.11 on that historic day. For investors considering timing their entry into the stock market during this period, understanding what actually materialized is essential.

The First Year Surge and Subsequent Challenges

Biden’s initial year saw remarkable momentum in equities. The stock market under Biden’s first twelve months delivered a 37.4% return—the strongest single-year performance under any sitting president since Harry Truman’s era in 1945. However, this euphoria proved short-lived. The year 2022 marked a significant reversal, with the S&P 500 declining over 19%, its worst annual performance since the 2008 financial crisis.

The stock market under Biden has navigated multiple headwinds including pandemic recovery efforts and sustained inflationary pressures. These economic challenges shifted voter sentiment and became central to political discourse heading into the 2024 election cycle.

Your $1,000 Investment: Real Numbers

Let’s examine a concrete scenario. An investor deploying $1,000 on Biden’s inauguration day could have purchased 2.62 shares of SPY at the opening price. Fast-forwarding to the present, with SPY trading at $472.26, that same initial investment grew to approximately $1,237.32.

This represents a cumulative gain of 23.7% over the period. Breaking this down annually, the average yearly return reached approximately 11.9%—a respectable but measured pace of wealth accumulation.

Comparing Presidential Market Returns

The stock market under Biden’s tenure, while positive, tells only part of the story when viewed against prior administrations. During Trump’s four-year presidency, the S&P 500 achieved average annual returns of 14.5%, outpacing the current administration’s 11.9% average. Over the full four-year Trump period, the SPY climbed roughly 67%, positioning it among the strongest multi-year runs in recent decades.

This comparison has become increasingly relevant as the stock market under Biden enters the 2024 election conversation. While recent months have brought new record highs to major indices, the cumulative returns lag historical comparisons to the previous administration.

Market Dynamics and Political Messaging

The administration has highlighted recent stock market peaks as validation of its economic stewardship. Meanwhile, critics contend that gains have disproportionately benefited asset holders rather than ordinary consumers struggling with living expenses and purchasing power erosion.

The divergence in perspectives underscores how the stock market under Biden has become a proxy battleground for broader economic narratives—one championed by the administration as evidence of recovery, while opponents argue it masks underlying consumer hardship.

Forward-Looking Investment Considerations

Investors positioning for 2024 and beyond continue exploring broad-based equity exposure through vehicles like the SPY, the iShares S&P 500 ETF (IVV), and the Vanguard 500 Index Fund (VOO). Each offers liquid, diversified access to large-cap U.S. equities.

Whether the stock market under Biden continues climbing to fresh all-time highs, or experiences consolidation, remains an open question tied to inflation trajectories, monetary policy, and election outcomes. Historical context suggests that multi-year equity investing, regardless of political backdrop, typically rewards patience.

The $1,000 invested on inauguration day demonstrates that even through volatility and shifting sentiment, remaining invested in broad market indices can generate meaningful long-term gains—though whether those gains satisfy investor expectations often depends on what benchmark one applies for comparison.