2024-01-02
Hello. Again.
Another year gone by. Another divided Congress (118th this time). Another congressional class disclosing financial transactions with possible conflicts. However this time, Congress blew the market out of the water.
For those who don't know, Unusual Whales is a stock, options, market-moving news service that provides the most affordable financial tools and services to traders. We focus on market transparency most of all, highlighting unusual trades in the stock market.
One of those fields that are filled with unusual trading is Congressional trading. We are the reason Congress has started acting on Congressional trading and financial conflicts. Our reporting eventually changed Congress, with our 2021 report going viral. ONLY AFTER it went viral, 6 trading bills were banned the next week (ha!). Our journalism had a part in changing the world and public perception around politician stock trading.
Before we get started with the report, we launched a way for anyone to follow the portfolios of their Congress members while they trade. You can get access with any UW subscription. You can find it at our portfolios page. Follow the politicians’ money making money, easily.
If you are looking for the TLDR for Congressional trading in 2023, it is here, as is the report's navigation.
Intro
A lot of crazy things happened in Congress last year. It’s been nearly one year since Kevin McCarthy failed to be elected Speaker of the House 14 times. It’s been six months since Senate Minority Leader Mitch McConnell froze on camera. It’s been a month since George Santos was expelled from Congress. It’s been six months since Senator Mendenez was caught for a SECOND TIME in a corruption scandal accepting gold bars, and he’s still in Congress. And it’s been two weeks since Nancy Pelosi began trading Nvidia options, AGAIN!!!! after divesting from semiconductors last year for possible conflict of interests.
During all of this, our elected officials have continued to buy and sell various financial assets. Our 2020 report got things started. Our 2021 Congressional Trading Report exposed how much and how often Congress was stock trading. It started a national discussion on whether politicians should be personally invested in individual companies while legislating. All from a little unusual whale. In the year that followed, hearings were conducted, bipartisan legislation was drafted, political leaders came out in support of a Congressional stock trading ban. But ultimately, nothing was done to reign in this behavior.
Our 2022 Congressional Trading Report caught the eye of individual Members of Congress. Many were upset with being singled out by their estimated returns. Some shared their financial statements with us to be fully transparent and set the record straight. We even collaborated with House Democrat Ro Khanna to discuss how feasible a Congressional stock trading ban would be and what it could look like.
I’m giving you this re-cap because it’s all thanks to YOU. Your continued interest and outrage on this topic has shown our politicians that we are paying attention. By reading these reports, talking about our findings and sharing it with friends, you make Congress very uncomfortable.
Here is the navigation for this year's report. It is long and thorough, so please read it all.
About This Report
Members of Congress are required to disclose their personal finances through financial disclosure procedures. Financial disclosure forms are filed annually and every time they or their families make a trade. These forms are made available to the public through the Office of the Clerk of the House of Representatives and the Office of the Secretary of the Senate. These forms are a key tool for promoting ethical conduct in Congress and are an important part of efforts to promote integrity and transparency in the legislative process.
This report analyzes data obtained from publicly accessible financial disclosure forms. We tried to compile all transactions published from 2020 to December 31, 2023. Politicians have up to 45 days to disclose transactions, though there are cases where transactions are filed years later with seemingly no penalty. This delay means that at the time of compiling this report, not all disclosures for 2023 may have been published.
We’ve been doing this report for four years now and we’ve accumulated a lot of data. This year, we’ll comment on trading trends over the last couple years. Since 2020, we’ve had 3 different classes come through those hallowed halls of Congress, with prominent stock traders coming and going. Let’s look at the broad trends and see if we can draw any conclusions from them. We outline our methodology and assumptions in the meat of the report.
At Unusual Whales, we lean on the side of more data rather than less. When you have the time and energy, please read the full report and let us know your thoughts over on X/Twitter, Threads, Reddit or Discord. You can find the TLDR below, as well as links to navigate to separate parts of the report, including the part of the report discussing returns of Congressional portfolios (which you can now follow at unusualwhales.com/portfolios). You can find our past reports at our politics page.
Congress beat the market, once again. Of 100 trading members, 33% beat SPY with their portfolios.
Democrats beat their Republican colleagues by a massive margin.
Members are once again trading options, after not trading them in 2022.
The overall number of transactions by Congress is down. They are also reducing time to disclosure, as well as using the note feature, because people now watch them vigorously.
There were many unusual trades and conflicts
If you are a member of Congress or aide reading this report, are embarrassed or want to work with us or fight for market transparency, we can be reached at congress@unusualwhales.com
Trading Over the Years
Congress typically files over ten thousand financial transactions each year. 2023 was no different with around 11,000 transactions filed. However at the time of writing this report, 2023 had the least transactions filed compared to previous pandemic years.
We found that this was mainly due to House Representatives filing less financial transactions, with House Republicans filing much less than their Democrat colleagues.
While some members report exact transaction amounts, transactions are typically reported as a range. Here we show the total value of transactions reported over the years by adding up the maximum and minimum amounts. The true value lies somewhere in between.
Despite the downward trend of recent years, 2023 saw over $1 billion USD in financial transactions disclosed by Congress (when taking the maximum disclosed amounts).
Last year, there was a sharp decline in the number of Congress members disclosing transactions compared to previous years! The 118th Congress had 115 members disclosing trades in its first year compared to previous classes 117th (January 2021 - January 2023) and the latter half of 116th (January 2019 - January 2021) with over 150 members disclosing trades.
Note that there are a total of 535 Members of Congress, with 100 in the Senate and 435 in the House. So in 2023, only a fifth of Congress members were trading, which was down from approximately one-third (2020-2022).
A contributing factor was the defeat/retirement of prolific stock traders from years past, such as Alan Lowenthal (572 stock trades from 2020-2022), Jim Langevin (93), Cindy Axne (138), Marie Newman (205), Kurt Schrader (330), Thomas Suozzi (336; and running again!), Chris Jacobs (263), David McKinley (144) and Trey Hollingsworth (69).
However, the current congressional class has some standout newcomers that have disclosed more stock trades than legislative votes.
Trying to show these trends by individual members gets messy because there are a few behemoths that disclose trades in the hundreds or thousands per year, while the majority disclose fewer than 100 trades a year. We see the few who those behemoths are below. Namely, House Democrats Ro Khanna, Josh Gottheimer, House Republican Michael McCaul and Senator Tommy Tuberville.
Let’s take the above chart and plot each member as their own smaller chart. That way, we can show trading activity of individual members over the last couple years. Note that this chart doesn’t show everyone.
It’s interesting to note the decline in trading activity by some members. A general rule I’ve found is that if they’re up for re-election in 2024, then they’ve severely decreased and/or stopped their trading activity in the last year. Seems to be true for Diane Harshbarger, David Kustoff, Carol Miller, Don Beyer, Debbie Dingell, Doug Lamborn, Debbie Wasserman Schultz, Deborah Ross, Michael McCaul, Katherine Clark, Ro Khanna, Susie Lee, and everyone’s favorite options trader, Nancy Pelosi.
So to recap: In 2023, we saw the number of trades down, the number of members disclosing trades down, but the value of transactions was comparable to years past. So what has Congress been trading?
The following two charts show that Congress has been selling more stocks than buying in the past couple years. They’ve also been selling more government securities (like Treasury bills, bonds and notes) in 2023 than previous years. They were buying more corporate securities (bonds and notes) in the last two years.
Generally, Congress has decreased their stock trading (when compared to previous years, with around $150M in transactions by both parties). Trading activity in other assets has increased.
So stock trading was down in the last year across party lines. The next chart shows that this was mainly due to House Democrats and Republicans selling more stocks than were bought. Senate Republicans were busier than Senate Democrats by selling more stocks and buying more comparatively.
Committees and Sectors
Members of Congress sit on important committees. Congressional committees play a crucial role in the legislative process by conducting in-depth examinations of proposed legislation, allowing for expert analysis and debate. These specialized committees enable members of Congress to focus on specific policy areas, streamline decision-making, and enhance the efficiency of the legislative branch.
We may be able to see interesting trading trends when we chart how committee members traded in different sectors. The following heatmaps show the number and value of stocks purchased and sold in different stock sectors. Yellow indicates a high value while blue shows a low value. White means no stocks were bought or sold in that sector.
Before we break down the actual heatmaps, it is important to remember that many of these stocks these members are trading are also legislated by their very committees. In no surprise, these conflicts do not stop members from trading those very stocks, like members of the Armed Services trading war stocks, and others.
House Committees
House Committee Stock Purchases
Here were the top 5 instances of committees with members posting the most stock purchases in 2023.
Members on the House Oversight and Accountability committee purchased Healthcare stocks in 435 separate transactions.
Members on the House Armed Services committee purchased Healthcare stocks in 392 separate transactions.
Members on the House Oversight and Accountability committee purchased Financial Services stocks in 328 separate transactions.
Members on the House Armed Services committee purchased Financial Services stocks in 277 separate transactions.
Members on the House Oversight and Accountability committee purchased Technology stocks in 272 separate transactions.
And the top 5 instances (by value) of stocks purchased by Members on the following committees.
Members on the House Homeland Security committee purchased $11.4M in Technology stocks.
Members on the House Foreign Affairs committee purchased $11.1M in Technology stocks.
Members on the House Oversight and Accountability committee purchased $9.9M in Healthcare stocks.
Members on the House Armed Services committee purchased $8.4M in Healthcare stocks.
Members on the House Oversight and Accountability committee purchased $6.6M in Financial Services stocks.
House Committee Stock Sales
Here were the top 5 instances of committees with members posting the most stock sales transactions in 2023.
Members on the House Oversight and Accountability committee sold Healthcare stocks in 387 separate transactions.
Members on the House Oversight and Accountability committee sold Technology stocks in 330 separate transactions.
Members on the House Oversight and Accountability committee sold Financial Services stocks in 295 separate transactions.
Members on the House Armed Services committee sold Healthcare stocks in 295 separate transactions.
Members on the House Armed Services committee sold Technology stocks in 263 separate transactions.
And the top 5 instances (by value) of stocks sold by Members on the following committees.
Members on the House Homeland Security committee sold $13.8M in Financial Services stocks.
Members on the House Homeland Security committee sold $13.3M in Technology stocks.
Members on the House Oversight and Accountability committee sold $13.3M in Healthcare stocks.
Members on the House Homeland Security committee sold $11.2M in Healthcare stocks.
Members on the House Foreign Affairs committee sold $11.1M in Technology stocks.
Senate Committees
Senate Committee Stock Purchases
Here were the top 5 instances of committees with members posting the most stock purchases in 2023.
Members on the Senate Health, Education, Labor and Pensions committee purchased Technology stocks in 45 separate transactions.
Members on the Senate Armed Services committee purchased Technology stocks in 45 separate transactions.
Members on the Senate Armed Services committee purchased Financial Services stocks in 40 separate transactions.
Members on the Senate Health, Education, Labor and Pensions committee purchased Financial Services stocks in 39 separate transactions.
Members on the Senate Health, Education, Labor and Pensions committee purchased Healthcare stocks in 36 separate transactions.
And the top 5 instances (by value) of stocks purchased by Members on the following committees.
Members on the Senate Health, Education, Labor and Pensions committee purchased $2.4M in Technology stocks.
Members on the Senate Armed Services committee purchased $2.4M in Technology stocks.
Members on the Senate Armed Services committee purchased $1.9M in Financial Services stocks.
Members on the Senate Health, Education, Labor and Pensions committee purchased $1.9M in Financial Services stocks.
Members on the Senate Veterans’ Affairs committee purchased $1.5M in Technology stocks.
Members on the Senate Agriculture, Nutrition and Forestry committee purchased $1.5M in Technology stocks.
Senate Committee Stock Sales
Here were the top 5 instances of committees with members posting the most stock sales transactions in 2023.
Members on the Senate Veterans’ Affairs committee sold Technology stocks in 33 separate transactions.
Members on the Senate Armed Services committee sold Technology stocks in 33 separate transactions.
Members on the Senate Environment and Public Works committee sold Technology stocks in 30 separate transactions.
Members on the Senate Environment and Public Works committee sold Financial Services stocks in 29 separate transactions.
Members on the Senate Health, Education, Labor and Pensions committee sold Technology stocks in 26 separate transactions.
And the top 5 instances (by value) of stocks sold by Members on the following committees.
Members on the Senate Armed Services committee sold $9.1M in Technology stocks.
Members on the Senate Homeland Security and Governmental Affairs committee sold $7.5M in Technology stocks.
Members on the Senate Aging committee sold $7.2M in Technology stocks.
Members on the Senate Budget committee sold $7.0M in Technology stocks.
Members on the Senate Veterans’ Affairs committee sold $2.2M in Technology stocks.
Members and Sectors
House Reps
Stock Purchases
Here were some standout House Representatives disclosing the most transactions in different sectors.
Representative Ro Khanna has disclosed his family purchasing stocks in 1589 separate transactions in Healthcare, Financial Services, Technology, Consumer Cyclical, Industrials, Consumer Defensive and Real Estate sectors. The progressive capitalist sits on the House Armed Services and House Oversight and Accountability committees.
Representative Michael McCaul has disclosed his family purchasing Technology stocks in 142 separate transactions. He sits on the House Foreign Affairs and House Homeland Security committees.
Representative Josh Gottheimer disclosed purchasing Technology stocks in 91 separate transactions. He sits on the House Intelligence and House Financial Services committees.
Representatives invested over $17M at a maximum in the Healthcare sector this year. With the most stocks purchased being up to $8.3M coming from Representative Ro Khanna and up to $3.9M from Representative Michael McCaul.
The value of stock purchases in the Technology sector summed to over $24M from representatives, with up to $10.1M by Representative Michael McCaul, $4.8M from Representative Khanna, and $2.5M from Representative Nancy Pelosi
Stock Sales
We can see that, again, Representatives Khanna and McCaul show up with the highest activity in stocks sold in 2023.
Representative McCaul sold $10.4M in Technology, $9.5M in Communication Services, $9.2M in Financial Services, $6.6M in Consumer Cyclical, and $6.4M in Healthcare stocks.
Representative Khanna sold $8.3M in Healthcare, $7.2M in Technology, $5.2M in Financial Services, and $5.1M in Consumer Cyclical stocks.
Representative Kevin Hern sold $5.1M in Technology stocks.
Senators
By comparison to their House colleagues, US Senators seem much more tame in the volume and value of stock transactions. Let’s check them out.
Stock Purchases
Senator Tommy Tuberville purchased Financial Services stocks in 23 separate transactions, Technology stocks in 22, Healthcare stocks in 16 separate transactions.
Senator Markwayne Mullin, who joined the Senate in 2023, purchased Technology stocks in 23 separate transactions, Healthcare stocks in 17, and Financial Services stocks in 16 separate transactions.
There was over $2M in Technology and Financial Services as well as $1.5M in Healthcare stock purchases in 2023 alone.
Senator Tommy Tuberville’s purchases amount for $1.5M of the Technology sector and $1.3M of the Financial Services Sector purchases.
Senator Markwayne Mullin purchased $900K in Technology stocks.
Stock Sales
Senator Tommy Tuberville sold Technology stocks in 22 separate transactions, Basic Materials stocks in 18, Consumer Defensive stocks in 11, and Financial Services stocks in 11 separate transactions.
Senator Thomas Carper sold Technology stocks in 15 separate transactions.
Senator John Hickenlooper sold Communication Services stocks in 13 separate transactions.
Senator Rick Scott sold $7.0M in Technology stocks.
Senator Tommy Tuberville sold $1.7M in Technology stocks and $1.2M in Basic Materials stocks.
Senator John Hickenlooper sold $1.7M in Communication Services stocks.
Senator Richard Blumenthal sold $1.5M in Communication Services stocks.
Top Sector Stocks
Here are the largest sectors and individual names for each sector in a heatmap for the 2023 trading year.
On the Purchased side, Apple, AAPL, and ConocoPhillips, COP, led the way in purchases.
On the sell side, MSFT, WTT, META, and GOOGL lead the sale sides. Numerous members seemed to be capturing gains in their portfolios due to how tech stocks exploded this year. These realized gains led to many members’ portfolios to have record years.
Top Valued Stocks
The following charts show the stocks with the highest total transaction amounts associated to them in 2023. We used the maximum disclosed amounts.
Top buys for House Republicans included ConocoPhillips (COP), Tyson Foods Inc (TSN), Alphabet (GOOGL) and NGL Energy Partners (NGL). While House Democrats bought up tech stocks such as Apple (AAPL), Microsoft (MSFT) and Alphabet too.
Top tickers that House Reps sold off in 2023 included Microsoft, Pioneer Natural Resources (PXD), Energy Transfer (ET), Alphabet and Meta.
Meanwhile in the Senate, top buys included Admiral Acquisition Ltd (ADMR:LSE), exclusively by Senator Richard Blumenthal, and PayPal (PYPL), Cleveland-Cliffs Inc (CLF), Qualcomm (QCOM), and Clorox Co (CLX) bought by everyone else.
Top sales in the Senate could largely be attributed to one Senator selling in large amounts. Namely the following:
Senator Rick Scott selling off all his shares of Wireless Telecom Group Inc (WTT, now delisted), when it was acquired by Maury Microwave
Senator Blumenthal selling Radius Global Infrastructure (RADI, now delisted), later acquired by EQT Active Core Infrastructure
Senator Tommy Tuberville buying but mostly selling off United States Steel Corporation (X)
Senator Blumenthal again selling off Liberty Media Corp Series C (FWONK)
Options Traders
You read that right, Congress is once again buying leveraged positions on equities they hold. In fact, in 2023 US Congress traded more options than they did in 2022 AND 2021!
Some notable highlights here, Josh Gottheimer traded, and this is no exaggeration, NEARLY $150 MILLION (!!!!) of option contracts in 2023. This was often done while Congress was in session.
Pelosi once again began trading options. You can read the history of her NVDA position below.Given the amount of option trading by members, you must wonder if members should be able to trade or sell leveraged positions on US equities, especially given the nature of these positions.
Portfolio Returns
Well, you’ve made it this far in the report. How did Congress really do this year?
It should be no surprise that Congress’s portfolios as a whole beat the S&P 500 at 25% returns YTD. Please check the caveats at the end of the report. How was this calculated?
The nice thing about Unusual Whales is we have done a pretty good job tracking Congress’s financial disclosures over the years, and have a good handle on the member’s portfolios. As a result, we took the portfolios this year for Congress, and tracked how they did (taking into account how those portfolios changed over the year as well).
It is possible that not all members disclosed their trades or portfolios properly over time. We rely upon delayed, sometimes inaccurate, and static data to construct their portfolios. As a result, there may be some errors. If you are a member of Congress and want to provide us your full portfolio like Pat Fallon did last year, then please reach out to us at congress@unusualwhales.com. We will gladly update our numbers with your accurate data.
With that, let’s jump into it.
The S&P 500 had a great year, up 24.23% (SPY itself is up 24.81%). However Democrats came out on top significantly, due to their heavy tech portfolios. Republicans only returned around 18%, which is still great. They underperformed as an aggregate because their portfolios are mainly in financials, oil, and commodities, which had a difficult year due to the banking collapses and high rate hikes.
Nevertheless, this is pretty incredible, that Democrats dominated their Republican counterparts significantly. Let’s break it down by member:
This chart above represents some of the top traders in 2023 and their approximate portfolio returns.
Many of the large portfolio gains are members who are holding unrealized gains in stocks like NVDA, or META, or other tech stocks. For example, Brian Higgins portfolio contains large holdings in NVDA, which he bought in 2021 and has held since.
Some other notable trades amongst these members is Pelosi holding her tech stocks from 2022 for massive gains in 2023. She also, at the year end, reinvested in Nvidia. I added the history of her Nvidia trades as a thread at the end of the report, if you are interested in it.
You can see the full portfolios of members and follow them at unusualwhales.com/portfolios
What about every member? Well some member portfolios, for example, Warren Davidson got decimated (due to holding a stock called Workhorse, WKHS, which was down nearly 80% this year.
However, with the top trades you can see a healthy mix of Democrats and Republicans. Here are the top ten:
Brian Higgins
Mark Green
Garret Graves
David Rouzer
Seth Moulton
Ron Wyden
John Rutherford
Richard Blumenthal
Nancy Pelosi
Pete Sessions
Some honorable mentions, Dan Crenshaw who was called out in our 2021 report, said that stock trading was the only way a Congressman could better themselves. His exact words were that without trading: "You have no way to better yourself" as a Congressperson. He was the 5th best trader in 2021, and in 2023, he beat the index with his portfolio up nearly 38%, a 15% beat on the index.
Senator Tuberville deserves a mention as well. Tuberville trades numerous futures and options contracts that are not captured here as it is difficult to determine if he is closing or opening some positions. Based on his options positions, he seems to be selling puts on numerous tickers to gain premium, however the disclosures do not accurately describe what he is doing. Also his futures contracts, nearly all of them, had all time highs this year. His portfolio is likely somewhere up between 35-45%, however we cannot be sure due to how he trades. It should be stated that he trades future contracts in agriculture, while directly sitting on the Committee of Agriculture in US Congress, a direct conflict.
One more mention, Thomas Carper. Carper himself announced his retirement this year, however that didn’t stop him from trading. In fact, Carper shorted the US economy multiple times this year, and even successfully closed his shorts for profit. On Oct 20th of 2023, Carper sold his positions held in the ProShares Short QQQ ETF (NYSE:PSQ). The transaction totaled sales of $3,000 to $45,000 according to the filing. He sold the PSQ for 6% profit, hedging his entire portfolio.
What about the House versus the Senate?
Senate Republicans had a great year (in fact, many of them are the top traders of the year this year). They had a 65% return on their portfolios in 2023. Senate Democrats on average had 33%. A pretty good year for the top members of the US Congress.
What about full realized trades in 2023? IE: Let’s look at a member or trade that only bought a stock in 2023, and sold that same stock in 2023. What were those average returns for that?
Well here were our rules for calculating those fully:
First, here’s how we estimated Congressional stock returns. We had to do this because there currently isn’t enough information provided in financial disclosures to be 100% sure of what losses or gains were made for each trade.
Start off with a dataset of all congressional stock trades since 2020
Every sale transaction by a Member of Congress that took place before the first instance of a buy of that stock by that Member was removed
Every sale transaction was associated with the closest buy of that stock for each Member and their accounts (going back to 2020)
Every remaining buy trade was associated to the closest sale date of that stock by that Member
Every unrealized stock purchased since 2020 was included and the unrealized returns were calculated to December 31, 2023
Here are those returns, assuming you only look at trades Congress bought and sold in 2023 ONLY.
As you can see, if you only take 2023 transactions realized on 2023 ONLY transactions, Republicans traded on 2023 stocks with around 8% gain on their fully new 2023 positions. This is likely because they took advantage of buying financials heavily during the banking crisis, and then sold after gains in the year. Democrats did worse on only 2023 trades, due to them holding their portfolio only. Again, this is for trades only made in 2023 (ie: a Congress person bought a stock in June of 2023, and sold in July of 2023 would count, thus only purely trades in 2023).
What about some of the highest realized trades in 2023?
Many of these stocks are ones you would expect. Numerous members, especially Democrats with regards to tech stocks (specifically TSLA, NVDA, AMZN and others). Some interesting trades stick out, specifically Josh Gottheimer’s MNST, Monster Energy and McCaul’s FN trades. The FN trades especially are interesting as it is a relatively unknown stock, and up 45% this year due to great earnings.
Let’s look at some events and themes that happened in 2023 Congressional trading.
