Upcoming elections combined with the ever-increasing number of media outlets have provided more platforms and more topics for political pundits and their predictions than ever previously. Sunday mornings can be dreary or exciting, depending on how you view the political talk shows.Making predictions about American federal politics can seem like Russian roulette without the bullets: you’ve got many chances to get it painfully wrong and fewer chances to get it right. Making a call on a presidential election based on factors that seem obvious can lead to a huge letdown, as Thomas Dewey and his supporters found in 1948 and as Hillary Clinton and her supporters found in 2016.At time of writing, American voter sentiment points to a possible re-election of President Donald Trump in the 2020 election. While his approval ratings are low in published polls, some political analysts give him odds of winning in the privacy of polling booths.In Canada, the political question marks include the extent to which the SNC-Lavalin (SNC) scandal will affect the Liberal Party’s chances of re-election.In both countries, even at this early stage, investors can at least begin preparing their portfolios for the outcome of these elections. Investors should expect incumbent governments in both countries to focus on record employment levels and current economic strengths while the challenging parties will target failed promises and areas of weakness.Related: Volatility: Yes. Corrections: Yes. Repeat of 2008: No. These competing narratives can influence short-term sentiment and investors need to stick to their investment plan while ignoring the noise, explains Jay Nash, Senior Vice-President, Portfolio Manager and Investment Advisor at the London branch of National Bank and a 21-year veteran of the financial sector.Nash says that investors who are concerned about downside risks can cope by increasing liquidity with larger than usual holdings of cash and bonds. That will enable them to remain invested through any increased volatility caused by political uncertainty in either country. This strategy also reduces the likelihood of being forced to sell shares at an inopportune time instead of being able to wait for a recovery. In addition, a larger-than-otherwise cash holding will mean that an investor has funds available if the political winds create an opportunity in a specific sector. This can mean upgrading equity holdings to focus on areas which are less likely to be impacted by political change such as large cap financial stocks can help, he says,While many believe they can call the results of the upcoming elections, those betting on market behavior based on a specific election outcome are often disappointed, Nash notes. Even where an individual makes the right call on the election outcome, equities will not necessarily respond in the way that one would expect.All other things remaining equal such as the current protectionist agenda in the United States, a Trump win in the next election could benefit U.S. operations with large predominantly domestic operations while those operating on a broad scale globally and dependent on free trade might lag, Nash suggests. At the same time, some multinationals such as Apple (AAPL) are currently adjusting their global manufacturing processes to accommodate new realities.At the same time, the health care sector will likely come under increased scrutiny regardless of the victor. Since both Democrats and Republicans agree that health care costs are too high, investors in this sector will need to be prepared for increased regulations and pricing restrictions. Nash suggests.While Trump’s tweets can be unpredictable his actual overall behavior may be more predictable. With no chance of a third term he may become more aggressive in his approach following a 2020 victory since a third term is not possible for American presidents. This could be a positive thing for markets, but only time will tell. If investors price in the likelihood that Trump will be more aggressive in the event that he wins a second term his actions will cause less of a surprise.As the election date approaches, much of what happens in the markets will depend on the prevailing view leading up to the election. If the actual outcome has been widely anticipated, the election will have a limited impact on the market, Nash explains. By comparison, a tight, less predictable contest can result in significant swings in equities. Disclosure: I do not hold any shares in any of the companies mentioned in this article and have no plans to purchase any of them.