Election Stocks: The Big Winners

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK (TheStreet) -- Investors are all too often their own worst enemies, and one common way this manifests itself is through political bias.

In the run-up to the reelection of President George W. Bush in 2004, die-hard Democrats were too willing to ignore or deny the economic expansion that was under way because they were anxious to see the incumbent lose his job. These emotions probably led some investors to miss out on the full benefits of the bull market that was under way then, and the same is true in 2012. Staunch Republicans accuse President Obama of leading the country down the road to ruin even as the S&P 500 has essentially doubled from the lows it made shortly after the Democrat took office -- an epic rally by historical standards.

I avoid discussing politics in this space because my own personal views are irrelevant to the subject at hand. Intelligent investors always strive to position their portfolio for the world as it is, not as they think it should be. Follow your heart in the ballot box, but when it comes to buying and selling securities, use only your head.

With that in mind, let's acknowledge that the presidential election is going to be an overriding focus in the markets this year and take a cold, hard look at the consequences of potential outcomes in November. We'll go ahead and assume that the frontrunner for the Republican nomination -- former Massachusetts governor Mitt Romney -- will prevail in the primaries, and the general election will be a contest between him and Obama. Furthermore, let's take the candidates at their word in terms of what they'll try to do if they win, despite the well-founded skepticism that I and others have about the authenticity of many of the promises that are being made to voters by both sides at this stage of the spectacle.

In terms of which side is likely to win, I'll refrain from forecasting the outcome and just point to the latest odds reported by the online trading exchange, Intrade, which has been a fairly reliable predictor of such things. Currently, Intrade gives Obama a 57.4% chance of being reelected.