This year investors have grappled with a plethora of global mysteries: Brexit, war in the Middle East, negative interest rates, energy prices, the Chinese debt bubble, Russian President Vladimir Putin’s policy- making and drama in Brazil.
Now, however, we face another big uncertainty: what an election battle between Donald Trump and Hillary Clinton might do to American asset markets.
Although Mrs Clinton, the presumed Democrat nominee, appears to have a fairly big lead over Mr Trump in the polls, the outcome of November’s presidential vote looks uncertain. We have all learnt in the past year how wrong pollsters can be.
What is even more unnerving for investors is that, as populism gathers momentum, it is eroding many of the normal boundaries of “right” and “left”, “pro-business” and “anti-business”. Discerning clear policy patterns amid the wild rhetoric is not easy for either Democrats or Republicans.
So what is an investor to do if they want to Trump-proof their portfolio - or even benefit from an ugly Clinton-versus-Trump fight? In the coming weeks, sellside banks and financial advisers will produce acres of ideas. Here are five of my own.
First of all, do not buy banks; or not if you hope government will boost their share price. Until recently, Mrs Clinton was perceived as being soft on Wall Street; indeed, some financiers hoped that bank-bashing would end in 2016.
But Bernie Sanders, her Democratic rival, has performed so well that Mrs Clinton will face pressure to steal his “socialist” language to appease his supporters, and may well pick an anti-Wall Street figure as her running mate, such as Sherrod Brown, an Ohio senator.
Mr Trump may not be so different. Many Republicans would love to repeal the post-crisis financial reforms, and he has criticised the Dodd-Frank Act. But he also seems instinctively hostile to Wall Street. As a self-appointed hero of angry main street voters, he is unlikely to embrace banks.
Second, do not expect a rally in Treasury bonds; at least, not one driven by debt cuts. A couple of years ago, it was presumed that by this point in the economic cycle policymakers would be discussing how to cut America’s vast debt burden. But Mrs Clinton is no fiscal hawk. On the contrary, she seems to lean towards fiscal stimulus, and may try to appease supporters of Mr Sanders this way.
And, while the Tea Party wing of the Republican party is eager to slash debt, Mr Trump has built a career on exploiting leverage.
He has vaguely promised to get rid of America’s $15tn debt in eight years; but he also wants to create jobs, boost growth and protect entitlements. Little wonder that traditional fiscally hawkish Republicans dislike him.
Third, embrace infrastructure stocks - whoever wins. Mr Trump built his brand with construction, and were he to win in November he would be likely to unleash a national infrastructure campaign to create jobs and growth. He likes the idea of being a second Franklin Roosevelt, the man who built America’s highway system.
But Mrs Clinton may do this too. After all, as Lawrence Summers, the former US Treasury secretary, recently pointed out, the beauty of infrastructure spending is that it could create middle-class jobs and growth at a time when monetary policy has reached its limits - at least, if you do not mind raising debt.
Fourth, expect currency volatility. The most eye-grabbing element of Mr Trump’s campaign so far has been his threats about trade protectionism. But Mrs Clinton has turned more protectionist, too, toning down her support of the Trans-Pacific Partnership. No one knows if her newfound caution will actually change trade flows or supply chains. But sabre-rattling on the global stage could certainly quickly unleash some currency swings.
Finally - and most importantly - investors need to invest in assets with an eye to capricious government intervention. After all, if there is one thing that will make sense of this peculiar election, it is the idea that voters have lost faith in the free-market political centre.
With populism rife, Mrs Clinton may deploy more consumer protection and regulation in response, while Mr Trump ay plump for endless protectionism.
Either way, if you want to invest in pharma, cars, tech or pretty much anything else, you would be a fool to make your choice based on economics or free-market theories alone. Populism matters, in investing and politics alike now - even, or especially, if it makes your head spin.
