Each quarter we offer a piece of market trivia that we believe is interesting or timely, or both. By now you’re probably sick of Presidential talk. However, we thought that one more reference to returns in a given year of a Presidential term was appropriate. By the looks of it, year one is the one to watch out for, particularly if it’s Republican.
In last quarter’s newsletter we had a piece called the “Incredibly Shrinking Stock Market” which highlighted how the number of publicly traded companies has shrunk from almost 7,500 to about 3,500 currently. The chart on the right shows this phenomenon with the new listings offset by the delists. The IPO’s are the biggest source of new listings, but as shown on the right chart, the number of IPO’s which peaked in 1996 has declined precipitously and is approaching all-time lows. The delists are a primary function of buyout activity which has accelerated as private equity fund assets have ballooned over the last several decades.