Members of Congress have beaten the market in recent years but their trades have come under growing scrutiny
By Jack Caporal – Updated Apr 2, 2024 at 4:07PM
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### KEY POINTS
* Number of stock trades made by Congress: Members of Congress make between 10,000 and 20,000 stock trades per year.
* Congress outperforms the market: Members of Congress beat the market by a wide margin in 2022 and 2023.
* The stock most traded by members: Microsoft was traded 141 times in 2023 by members of Congress.
* Motley Fool Issues Rare “All In” Buy Alert
More than 100 members of Congress have made over 10,000 stock trades each year since at least 2021 — and they tend to beat the market.
How do they do it? The stocks that representatives and senators trade the most are household names: Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), and Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL).
Others made timely trades involving companies and sectors related to legislation they work on and sit on committees that oversee those companies and sectors, raising questions about conflicts of interest and insider trading.
For example, Nvidia (NASDAQ:NVDA) was traded or held by members, including former House Speaker Nancy Pelosi (D-CA), while the CHIPS and Science Act was being negotiated and voted on. Other members made opportunely timed trades in early 2023 involving banks under distress and their rescuers. Sen. Tommy Tuberville (R-AL) traded corn futures while serving on the Agriculture Committee.
Dive deeper into stock trading by members of Congress below, including who’s trading the most and netting the biggest returns.
A note on the data used in this article: Data on stock trading by members of Congress varies widely between sources due to differences in data collection, difficulties with data collection, and different methodology in parsing that data. Figures from multiple sources are included when possible.
### How Much are Members of Congress Trading Stocks?
More than 100 members of Congress have, in sum, made at least 10,000 trades per year since 2021.
Capitol Trades reports that 118 members of Congress made 11,491 trades in 2023 involving 751 million shares or other assets. Volume increased by more than 140 million in 2023 compared to 2022, but total trades were down from 14,752, and 36 fewer members made trades.
Data source: Capitol Trades (2024).
YEAR TRADES VOLUME (MILLIONS) MEMBERS
2021 10,413 583.98 138
2022 14,752 610.77 154
2023 11,491 751.17 118
Unusual Whales, a financial data platform, found that roughly 11,000 trades were made in 2023, down from 12,700 in 2022. Those trades were estimated to be worth just over $1 billion based on maximum amounts disclosed by members of Congress. That’s up from around $788 million in 2022.
The Members of Congress Making the Most Trades
These are the members who made the most trades in 2023 and their trade volume, according to data from Capitol Trades:
Data source: Capitol Trades (2024).
MEMBER TRADES VOLUME (MILLIONS)
Rep. Ro Khanna (D-CA) 4,253 94
Rep. Michael McCaul (R-TX) 1,826 287
Rep. Daniel Goldman (D-NY) 1,306 30
Rep. Josh Gottheimer (D-NJ) 620 93
Sen. Tommy Tuberville (R-AL) 404 11
Rep. Lois Frankel (D-FL) 219 2
Sen. Tom Carper (D-DE) 216 4
Rep. Greg Stanton (D-AZ) 188 2
Rep. Diana Harshbarger (R-TN) 178 2
Rep. Kevin Hern (R-OK) 162 21.73
### What Stocks are Members of Congress Buying and Selling?
Members of Congress buy a range of stocks, but the majority of their trading is done in well-known companies. That’s reflected in the sectors in which they trade the most:
Technology, energy, healthcare, defense, and financial services were the sectors bought most often, according to Unusual Whales.
The sectors sold the most were technology, communication services, energy, healthcare, and defense.
Microsoft and Alphabet made the top 10 on every popularity list, including the most bought and sold by value, most traded by volume, most number of trades, and traded by the most members of Congress. Apple appeared on every list except most sold by value.
Nvidia was the 10th most sold stock by value in 2023 but didn’t crack the top 10 for the most bought stocks — something members of Congress may be kicking themselves over.
#### The stocks bought most by members of Congress
By value (2023)
ConocoPhillips (NYSE:COP): $2.5 million
Apple: $2.4 million
Tyson Foods (NYSE:TSN): $2.04 million
Microsoft: $1.97 million
Alphabet: $1.49 million
PayPal (NASDAQ:PYPL): $1.45 million
NGL Energy Partners (NYSE:NGL): $1.35 million
Bayer AG (ETR:BAYN): $1.31 million
CVS (NYSE:CVS): $1.25 million
Arista Networks (NYSE:ANET): $1.24 million
Data source: Unusual Whales (2024)
#### The stocks sold most by members of Congress
By value (2023)
Microsoft: $11.61 million
Wireless Telecom (NYSE:WTT): $7 million
Pioneer Natural Resources (NYSE:PXD): $5.04 million
Energy Transfer LP (NYSE:ET): $3.42 million
Alphabet: $3.4 million
Meta (NASDAQ:META): $2.6 million
Activision Blizzard (NASDAQ:ATVI): $2.53 million
Citigroup (NYSE:C): $2.08 million
UnitedHealth Group (NYSE:UNH): $2.02 million
Nvidia: $1.76 million
Data source: Unusual Whales (2024)
#### Stocks traded by members of Congress by number of shares
Microsoft: 98.01 million
JPMorgan Chase (NYSE:JPM): 26.79 million
Nvidia: 4.95 million
Alphabet : 3.72 million
Apple: 3.42 million
Citigroup: 3.32 million
PayPal: 2.26 million
Amazon (NASDAQ:AMZN): 2.19 million
Meta: 2.13 million
Intel (NASDAQ:INTC): 1.72 million
Data source: Capitol Trades (2024)
#### The stocks traded most by members of Congress by transaction count
Includes all trades (2023)
Microsoft: 141 trades
Alphabet: 116
Citigroup: 72
JPMorgan Chase: 71
Nvidia: 69
Apple: 62
Amazon: 59
Coca-Cola (NYSE:COKE): 54
Bank of America (NYSE:BAC): 53
Meta: 53
Data source: Capitol Trades (2024)
#### The stocks traded by the most members of Congress
Number of members who traded the stock, 2023
Microsoft: 23 members
JPMorgan Chase: 21 members
Apple: 20 members
Alphabet: 18 members
Nvidia: 18 members
Amazon: 18 members
Verizon (NYSE:VZ): 17 members
Johnson & Johnson (NYSE:JNJ): 17 members
Coca-Cola: 16 members
Comcast (NASDAQ:CMCSA): 14 members
Data source: Capitol Trades (2024)
Did Congress Beat the Market in 2023?
Congress as a whole easily beat the market in 2023. Democrats managed an average return of 31.18%, and Republicans saw an average return of 17.99%. That’s compared to the S&P 500 returning 24.23%, according to estimates from Unusual Whales.
Thirty-three out of 100 members of Congress who made trades earned returns above the S&P 500.
Per Unusual Whales, Republicans failed to beat the market — and Democrats — in 2023 because, generally, their portfolios are tilted toward financials, oil, and commodities, which struggled given the short-lived banking crisis and rising interest rates.
Democrats held portfolios that favored tech stocks, netting them larger returns.
These numbers reflect realized and unrealized returns in 2023. When considering only realized returns on stocks bought and sold in 2023, Republicans had an 8.15% return, and Democrats had a 4.42% return.
### Members of Congress with the Best Returns in 2023
Rep. Brian Higgins (D-NY): +238.90%
Rep. Mark Green (R-TN): +122.20%
Rep. Garret Graves (R-LA): +107.60%
Rep. David Rouzer (R-NC): +105.60%
Rep. Seth Moulton (D-MA): +80%
Sen. Ron Wyden (D-OR): +78.50%
Rep. John Rutherford (R-FL): +69.10%
Sen. Richard Blumenthal (D-CT): +68.10%
Rep. Nancy Pelosi (D-CA): +65.50%
Rep. Pete Sessions (R-TX): +63.30%
Data source: Unusual Whales (2024).
Rep. Brian Higgins’ impressive returns of nearly 240% in 2023 and Rep. David Rouzer’s 105.60% return appears to be fueled by shares of Nvidia purchased in 2021.
Rep. Mark Green’s 122.20% return was built on trades almost exclusively in the energy sector with a focus on two companies: Energy Transfer LP and NGL Energy Partners LP (NYSE:NGL), according to Capitol Trades.
Green rebalanced away from Energy Transfer and more toward NGL, the latter of which popped 380% over the course of 2023. He heavily purchased NGL in the first three quarters of 2023 and sold some shares in the fourth quarter that year. He largely sold Energy Transfer throughout the year, picking up a relatively small number of shares in the first and fourth quarters.
Rep. Seth Moulton sold $250,000 worth of Activision Blizzard stock on June 13 after the FTC filed paperwork to block the company’s merger with Microsoft the day before. The congressman publicly defended his trade, explaining that the news was public information when he made the sale and that his wife had earned Activision Blizzard stock as part of her compensation when working for the company.
Rep. Nancy Pelosi’s 2023 returns look to be driven by a number of successful options plays involving significant amounts (millions of dollars worth) of Apple and Microsoft contracts. Trading tech stocks and making options plays aren’t new for the former speaker; she’s been successfully doing so for years. Her success in the market has attracted followers who try to replicate her trades.
### Members of Congress with the Worst Returns in 2023
Rep. Warren Davidson (R-OH): -77.10%
Rep. Austin Scott (R-GA): -56.50%
Sen. Peter Welch (D-VT): -16%
Rep. Virginia Foxx (R-NC): -11.40%
Rep. Harold Rogers (R-KY): -11.40%
Rep. Brian Mast (R-FL): -11%
Rep. Robert Latta (R-OH): -9.80%
Sen. Roger Marshall (R-KS): -9.60%
Sen. Gary Peters (D-MI): -7.60%
Sen. Rand Paul (R-KY): -6.80%
Data source: Unusual Whales (2024).
Rep. Warren Davidson’s rough year was due to his stake in Workhorse (NASDAQ:WKHS), an electric vehicle startup that fell about 80% in 2023.
Rep. Austin Scott has not had much luck with his investments in companies building clean energy tech, including fuel cells. His investments in Nuvve (NASDAQ:NVVE), Ballard Power Systems (NASDAQ:BLDP), and Bloom Energy (NYSE:BE) haven’t panned out. He also appears to be holding on to some losses from Katapult Holdings (NASDAQ:KPLT).
It’s not clear where Sen. Peter Welch’s losses came from. He pledged to stop trading individual stocks in 2021 after he disclosed his wife’s sale of ExxonMobil (NYSE:XOM) shares a week late.
Rep. Virginia Foxx is one of the most active traders in Congress. She’s made hundreds of trades worth millions of dollars over the past decade. She bought $465,000 and sold $718,000 worth of shares across a range of industries in 2023, according to Quiver Quantitative. Her active strategy didn’t pay off in 2023 when her portfolio returned -11.4%, according to Unusual Whales.
Rep. Harold Rogers has traded mostly mutual funds offered by Bridge Builder (NASDAQ:BBGLX) and Vanguard in recent years and sold roughly five times more than he bought in 2023. He had a -11.4% return that year.
### Congressional Stock Trading Rules
Members of Congress and their immediate family are free to buy and sell stocks as long as trades of $1,000 or more are reported within 45 days, as required by the 2012 STOCK Act.
Members of Congress are not prohibited from trading stocks that involve companies that could be affected by legislation they are considering or companies they oversee through committee assignments.
Insider trading laws do apply to members of Congress, but information gained from their work may not meet the definition of insider information.
### What’s Next for Stock Trading in Congress?
Members of Congress have come under increasing scrutiny for stock trading, particularly when trades are made involving companies that fall under the jurisdiction of committees they sit on, or when they trade stocks that may be impacted by legislation and other policy decisions into which they have unique insight.
A 2022 New York Times analysis found that 97 members of Congress — nearly a fifth of elected representatives and senators — made trades from 2019 and 2021 that could amount to a conflict of interest based on their committee assignments.
There has been a steady stream of stories on members of Congress making trades at opportune moments in the past four years. These include trades made prior to the onset of COVID-19 in the U.S., around the Silicon Valley Bank collapse, and in advance of the Ukraine-Russia war and the conflict between Israel and Hamas.
Those stories and the creation of databases to track Congressional stock trading have spurred some in Congress to draft legislation to ban members (and their spouses) from trading individual stocks. Despite bipartisan sponsorship, those bills haven’t been picked up by committees or made it close to a vote in the House or Senate.
While politicians are weighing what to do about stock trading rules, the public overwhelmingly believes members of Congress should be banned from trading individual stocks. A 2023 Nielsen survey found that 86% of Americans supported a ban on members of Congress trading stocks in individual companies.
The argument for a ban that the public found most convincing? There are too many potential conflicts of interest for members of Congress to be buying and selling individual stocks.
### Sources
Capitol Trades (2024). “Capitol Trades 2023 Recap – A Year of Shifting Tides for Congress.”
Newsweek (2023).”Politicians Profit as Military Stocks Soar Since Hamas-Israel Conflict.”
Newsweek (2023). “Republican Senator’s Stock Trade Linked to Ukraine War Raises Eyebrows.”
The New York Times (2023). “As Fears of Banking Crisis Surged, Members of Congress Sold Bank Shares.”
The New York Times (2022). “Stock Trades Reported by Nearly a Fifth of Congress Show Possible Conflicts.”
ProPublica (2020). “Senator Dumped Up to $1.7 Million of Stock After Reassuring Public About Coronavirus Preparedness.”
Quiver Quantitative (2024). “Congress Trading Dashboard.”
Roll Call (2024). “These lawmakers are still invested in banning congressional stock trades.”
University of Maryland Program for Public Consultation (2023). “Ban on Stock Trading for Members of Congress Favored by Overwhelming Bipartisan Majority.”
Unusual Whales (2024). “Congressional Trading 2023.”
Unusual Whales (2023). “2022 Congressional Stock Trading Report.”
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Author: Jack Caporal
Updated: Apr 2, 2024 at 4:07PM
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