All You Need to Know About Trading Like Congress

Some investors are mimicking lawmakers’ stock trades—but is it smart or ethical?

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In the world of investing, there are strict laws that prohibit trading based on non-public information or insider trading. But some believe that these rules don’t necessarily apply to politicians, particularly members of Congress.

Why? Through their day-to-today work, members of Congress inherently have access to non-public information. They sit in on committee briefings and meetings with industry leaders that could reveal major economic developments and policy changes. Some say this gives them an upper hand and an opportunity to act before you can.

So if you can’t beat them, why not join them?

There are many investors who try to mimic the trades of members of Congress through various means. But there are many advantages and disadvantages to this practice, as well as both ethical and practical questions to ponder. So let’s take a closer look.

Why Invest Like Congress?

Studies show that in various cases, members of Congress have made suspiciously well-timed trades right before major economic events.

In 2023, politicians serving on banking-related committees, for example, traded bank stocks during the internal turmoil that led to the collapse of Silicon Valley Bank (SVB) and other financial institutions. Members of Congress also made suspicious trades at the height of the COVID-19 pandemic, according to a study published in the International Review of Economics & Finance. And an episode of “60 Minutes” revealed that some members of Congress may have profited from their trades during the financial meltdown of 2008–09.

But ask any member of Congress about winnings in the stock market, and they’ll probably point to luck or the acumen of their financial advisors.

Nonetheless, the law is trying to crack down on potential wrongdoing. The Stop Trading on Congressional Knowledge (STOCK) Act of 2012 aims to prevent insider trading among Congress. It requires lawmakers to disclose stock trades of $1,000 or more within 45 days.

However, critics say the law has many flaws and is poorly enforced.

So, as of now, you can theoretically make the exact same trades as members of Congress. So how do you go about doing that?

How to Invest Like Members of Congress?

There are several websites that track trades made by members of Congress via public disclosures. These include Capitol Trades, InsiderFinance, and Unusual Whales.

But you can also invest in exchange-traded funds (ETFs) that aim to replicate the trades made by lawmakers and their families.

Subversive in 2023 launched two such funds. They are the Unusual Whales Subversive Democratic Trading ETF (NANC) and the Unusual Whales Subversive Republican Trading ETF (GOP).

The NANC is an actively managed ETF that focuses on trades made by Democratic members of Congress. The tech-heavy ETF’s main holdings include Nvidia, Microsoft, and Alphabet.

The GOP is a more diversified ETF that gives you exposure to sectors like financials, energy, and cryptocurrency. Its main holdings include JPMorgan Chase & Co., AT&T, and the iShares Bitcoin Trust ETF.

Each ETF has an expense ratio of 0.74 percent, which is relatively high compared to low-cost index funds.

With that said, there are some risks you should be aware of before you start trading like members of Congress.

Risks

With emerging technology, there’s a lot of information out there about what exactly lawmakers are trading. However, this information could have some flaws.

For starters, the STOCK Act requires lawmakers to self-report trades of more than $1,000 within 45 days, and they can even request extensions of up to 90 days. This means that websites and the ETFs tracking these trades don’t actually replicate trades in real time. So by the time you learn of a trade, it may be impossible to recapture the same gain.

Moreover, the Congressional Subversive ETFs don’t always beat broad market indexes. This is especially troubling considering their high fees. A low-cost index fund may even provide higher returns at a lower cost.

And there’s also the question as to whether these ETFs will stand the test of time.

The strategy of trading like members of Congress is entirely based on the assumption that lawmakers are trading based on access to non-public information—something which is illegal. So if these ETFs prove to perform exceptionally well, stricter laws may be placed on lawmakers’ trading activities. In an extreme case, they may be prohibited from trading stocks altogether. That would make this entire strategy obsolete.

The Bottom Line

Many people believe that because of their access to non-public information that could have a massive impact on financial markets and the economy, members of Congress may have an upper hand when it comes to trading stocks.

Some investors are actively trying to trade like members of Congress using legal disclosures and by investing in ETFs that aim to track congressional trades.

But while evidence shows that members of Congress have at times profited from very carefully timed trades, laws exist to prohibit them from engaging in insider trading. And these laws could become stricter over time. In fact, it may prevent them from trading at all. So it also may help to consider alternatives. You can create a diversified portfolio using low-cost index funds that give you exposure to broad stock market indexes and other securities.

So while it could be beneficial to test the water of trading like members of Congress, some experts may suggest you don’t make it your only investing strategy.

The Epoch Times copyright © 2025. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.