Investors are betting on a big Republican wave in the midterm elections. If Republicans take at least one chamber of Congress in Tuesday's midterm election, that will likely result in more gridlock, which the market usually loves.

According to data from Edelman Financial Engines, the S&P 500 had an annualized return of 16.9% since 1948 during the nine years when a Democrat was in the White House and Republicans had a majority in both chambers of Congress. That compares to 15.1% during periods of full Democratic control and 15.9% in years when there was a unified GOP government.

Investors are more than happy when politicians bicker but don't actually enact any new laws that may hurt corporate profits.

@Tiger_chat