Political Tailwind? Congress Trading Ban Could Boost SPY, IVV

Author: Chandrima Sanyal | November 12, 2025 02:10pm

Rep. Anna Paulina Luna of Florida recently announced on X that, as soon as the government reopens, the bill to ban insider trading among members of Congress will be marked up in committee.

The bipartisan “Restore Trust in Congress Act” would ban members of Congress, their spouses, and their dependent children from owning or trading individual stocks, securities, commodities, or futures, as explained in a Yahoo Finance report.

If implemented, it could dramatically change the way the Washington establishment invests — and ETFs, which hold a basket of assets and trade like a single stock — could become the default option.

As lawmakers move closer to a potential ban on trading individual stocks, ETFs are emerging as the likely go-to investment vehicle-not just for public officials, but for any investors seeking broad, hands-off exposure.

Speaker Johnson has notified me that as soon as we return and the government is reopened, the bill to ban insider trading is going to be marked up in committee.

This is a big win for America.

— Rep. Anna Paulina Luna (@RepLuna) November 10, 2025

The following broad-market ETFs offer exposure to hundreds of companies in a single fund, eliminating the need for active stock picking:

• The SPDR S&P 500 ETF Trust (NYSE:SPY): The oldest and one of the largest ETFs in the U.S., tracks the S&P 500 index and covers major sectors like technology, health care, and finance.
• iShares Core S&P 500 ETF (NYSE:IVV): Offers a similar structure but with a lower expense ratio (0.03% against SPY’s 0.095%), appealing to cost-conscious investors.
• Vanguard Total Stock Market ETF (NYSE:VTI): VTI goes further and encompasses the whole U.S. stock market, including the small- and mid-cap stocks, to provide the widest diversification.

Also Read: Government To Reopen After Historic Shutdown: Federal Services ETFs Mixed As Investors Await Spending Clarity

Sector-specific ETFs can also serve as a compliance-friendly option:

• The Technology Select Sector SPDR Fund (NYSE:XLK) holds large-cap tech stocks like Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT), and Nvidia Corp (NASDAQ:NVDA).
• The Industrial Select Sector SPDR Fund (NYSE:XLI) grants investors access to major manufacturers and defense companies.
• The Energy Select Sector SPDR Fund (NYSE:XLE) covers energy producers and utilities.

All of these ETFs let investors seek thematic exposure without having to pick individual stocks—a key benefit for lawmakers who must avoid conflicts of interest.

Investor Takeaway

Even as legislative processes are slow, political and public sentiment towards ethical investing should be a boost for ETFs.

Large-cap, broad-market, and sector ETFs already provide that transparency, diversification, and automation that can make them politically and practically appealing.

In a possible post-ban era, these funds could attract not just lawmakers but the wider audience of investors who want to align market participation with ethics.

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Image: Shutterstock

Posted In: AAPL IVV MSFT NVDA SPY VTI XLE XLI XLK