Nancy Pelosi Has Lost Her Stock-Picking Mojo With a Loss of 20 Percent in 2022: Republican US House Members Eke Out Average Gains of 0.4 Percent vs. a Loss of 1.76 Percent for the Democrats

Rohail Saleem
Nancy Pelosi US Congress
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This is not investment advice. The author has no position in any of the stocks mentioned. has a disclosure and ethics policy.

All good things must end eventually. Such is the prevailing norm in this ephemeral world. For the traders who continued to closely follow the stock picks of the former US House Speaker Nancy Pelosi throughout 2022, the gravy train ended rather abruptly. Fear not, though. After all, an average US House member still managed to beat the market in one of the most difficult financial periods in recent memory, giving impetus to the thesis of following Congressional trades to generate some much-needed alpha in this market.

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Unusual Whales has now published an exhaustive report on the stock trading outcome of US Congress members in 2022. In what might be one of the most striking outcomes, Nancy Pelosi ended 2022 on a rather dour note, with a loss of around 20 percent. This almost exactly matched the S&P 500 index, which ended the year with a loss of a little over 19 percent. According to Unusual Whales, many of the deep-in-the-money options bought by the Pelosis expired at a loss, leading to this rather unremarkable performance for 2022. Of course, given the attention that Nancy Pelosi and her husband continued to garner over the supposed superiority of their stock picks, the question emerges whether this loss was a deliberate attempt at deflection. Diabolical, if true.

For the uninitiated, Nancy Pelosi attracted quite a lot of attention when she exercised – via her husband, Paul Pelosi – 200 call options related to 20,000 NVIDIA shares in the run-up to the CHIPS Act approval. These options were purchased back in 2021 and carried an exercise price of $100. However, after a broad-based uproar, the Pelosis were forced to liquidate their NVIDIA bet at a loss of $341,365 (you can peruse the relevant Periodic Transaction Report here).

In another instance of characteristic "foresight," Nancy Pelosi started dumping Visa shares as a key bipartisan legislation began to attract substantial notice, with the most recent liquidation taking place in November 2022. The Credit Card Competition Act of 2022 was introduced back in July by Senators Dick Durbin (D-IL) and Roger Marshall, M.D. (R-KS). House members Peter Welch (D-VT) and Lance Gooden (R-TX) then introduced a companion version of this bipartisan legislation in September. The bill aims to break up the Mastercard-Visa duopoly by requiring major banks to "allow electronic credit transactions to be processed on no fewer than two unaffiliated networks, at least one of which must be outside the Visa-Mastercard duopoly." For obvious reasons, should this legislation turn into a law, the negative ramifications for Visa and Mastercard shares cannot be understated.

Despite the rather average stock trading performance of Nancy Pelosi during 2022, most US House members still managed to beat the market by a long shot. As illustrated by Unusual Whales in the tweet above, an average Republican House member was up 0.38 percent in 2022, while a typical Democrat House member was down 1.76 percent during the same period. For reference, the benchmark SPY ETF was down 18.2 percent during the year. The fact that so many US legislators are able to consistently beat the market is a cause of concern. Has the time come to bar House members and Senators from trading stocks ahead of key legislative attempts?

Interestingly, the Republican Pat Fallon was up a whopping 51 percent in 2022! It seems that Nancy Pelosi has given Fallon her stock-picking crown.

Do you think an outright ban on Congressional trading is the need of the hour? What about greater oversight? Let us know your thoughts in the comments section below.

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