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UK Vote to Leave the EU – The Effects on Portfolio’s - 24th June 2016 07.28 am

Wow, the bookies were wrong, the pollsters were wrong (again) and the markets were wrong. Even Nigel Farrage thought we would Remain at around 2am this morning. It all changed after that.

Anyway, we have now decided to go it alone and the short term shocks will be severe. The futures market are predicting that the FTSE 100 will open 8% down and there may also be carnage in the US.

However, it is times like this when we remind everyone that there is no need to panic. There will always be asset classes that do well in times of strife. Equity markets can rise and fall, especially when they all get it wrong. (including me)

Gilts should continue to strengthen, as they have done in the last few months as investors look for safe havens while the markets settle down again. Property funds will benefit from the fall in sterling which will interest foreign buyers, as sterling continues to slide. Gold, another safe haven will do well on the back of falling sterling and a flight to safety, meaning that Troy Trojan and Investec Cautious Managed will continue their rallies.

We will look for some opportunities in the coming days and weeks, as there will be many, but long term investors, with a balance of different asset classes, will see some short term dips but I believe that it wont be as bad as it first appears this morning.

As ever, if you want to discuss your portfolio, speak to your adviser.

Phil J McGovern FPFS

This is a general newsletter and cannot be construed as individual advice. Please speak to your qualified adviser before making any investment decisions and the value of your investments can fall as well as rise in line with market conditions.

 

 

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