86% Of Investors Think Lawmakers Trade On Inside Info. Many Copy Them

Retail investors overwhelmingly believe members of Congress trade stocks with an insider’s edge. Many are trying to cash in by copying their investments.

Eighty-six percent of U.S. investors believe lawmakers trade inside information, while 90% don’t trust Congress to police its own stock trading, according to a MarketWise survey of 1,005 investors.

But suspicion of Congress has also spawned copycat investing. Half of investors surveyed have copied the publicly disclosed trades of a politician, executive, celebrity or financial influencer. Of those, 41% said the strategy made them money.

Among investors who follow politicians’ portfolios, 72% said they do so because they assume lawmakers have an information advantage.

Former House Speaker Nancy Pelosi, D-Calif., is nearly as popular with copycat investors as Berkshire Hathway’s Warren Buffett: 34% followed Pelosi’s trades, compared with 35% for Buffett.

The findings arrive as Congress wrestles with its own stock-trading rules. The House passed the Stop Insider Trading Act in July in a bipartisan vote. The bill prohibits members of Congress, spouses and dependent children from buying individual stock. It still faces Senate consideration.

Nearly 59% of investors want lawmakers banned from trading individual stocks. Another 21% would permit trading only through blind trusts. Just 8% believe lawmakers should be free to trade as they do today.

More than half, 53%, would be less likely to vote for a candidate who actively trades individual stocks.

Investors who mirror congressional portfolios can outperform the market—although which party they’re following has mattered.

The NANC ETF, which follows Democratic lawmakers and spouses, returned 105.2% cumulatively from its February 2023 launch through June 30, compared with 91.3% for the S&P 500 Total Return Index. But Republicans have taken the lead this year. The GOP ETF, formerly KRUZ, gained 23% through June, more than double NANC’s 10.95% and the S&P 500’s 10.21%.

Those returns don’t prove lawmakers possess an informational advantage, experts say. A 2025 academic study found neither congressional ETF significantly beat the market after adjusting for risk. Earlier research covering congressional trades from 2012 through 2020 similarly found no evidence of superior performance.

Retail investors appear willing to bet otherwise.

Eighty-four percent of copycats find trades on YouTube, Reddit, X or TikTok. Fifty-nine percent have traded within 24 hours of seeing a single social media post, rising to 73% among Gen Z.

The behavior can look increasingly like speculation.

Forty-two percent have copied a famous person’s trade without researching the company. Another 46% have jumped in after the stock already surged.

Fourteen percent have taken on debt or used margin to finance a copied trade. Nearly half, 47%, acknowledged following famous trades makes investing feel more like gambling.

There are historical reasons investors believe politicians possess an edge.

Former Republican Sen. Richard Burr, who chaired the Senate Intelligence Committee, sold much of his stock portfolio shortly before markets plunged during the Covid-19 pandemic. An FBI affidavit later estimated his “well-timed stock sales” generated more than $164,000 in gains and helped him avoid more than $87,000 in losses. The Justice Department investigated but closed the case without charges.

Former Republican Sen. Kelly Loeffler drew scrutiny after she sold $20 million in stocks starting the day she attended a private Senate Covid briefing in January 2020. The general market fell roughly 30% in March 2020. Her portfolio also bought shares of teleworking firm Citrix before pandemic lockdowns sent demand soaring. 

 

Loeffler maintained her portfolio was independently managed. The Justice Department closed its investigation without charges in May 2020.

Investors may even move markets when congressional trades become public. Academic research has found positive market reactions following disclosures of senators’ stock purchases, with stronger reactions when the lawmaker served on a committee with jurisdiction over the company.

But congressional disclosures aren’t real-time trading alerts. Under the STOCK Act, lawmakers generally have up to 45 days to disclose a transaction. By the time an investor sees the trade, much of its potential gain may already be reflected in the price.

Some investors keep copying anyway.

Nearly one-quarter, 23%, said they continued following someone even after that person’s trades lost them money.