Brexit 7 Days On

In June 30, 2016
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Post Referendum Update

 

Well, what a crazy few days it has been! In the last week we’ve had the EU Referendum, the Prime Minister resign, Labour start to crumble. We have seen Gove and Farage back track on £350m NHS funding. And most surprisingly, Wales are still in Euro 2016!

We predicted the outcome of the Referendum would be a remain vote. We were wrong, and for that I am sorry. We are in good company, with Branson, Hawking, the Chancellor, and the Bank of England Governor, Mark Carney, all agreeing an in vote was required. And, most importantly, the great and well known philosopher, David Beckham said it should be a vote to remain! But it wasn’t. Now we have a divided country, with those that voted to remain, shocked at the result and those that voted to leave, also shocked with the out result.

So what’s happened over the last few days in the financial world? There have been massive falls around the world. The FTSE 100 has fallen around 4%, as has the FTSE All-Share. The FTSE 250 has fallen by 8%. In Europe, Italy fell by 10%, Spain by 12% and if you take an average across Europe you will find a fall of around 8%, and there has also been a 30 year low on Sterling.

How has this affected our Clients Portfolios and has the diversified investment strategy and downside protection worked?

I am pleased to say that the Portfolios have held up very well. Across the Portfolios we have actually seen performances since Friday’s result range from -1% to +2%, pretty fantastic compared to the £120bn wiped off of the FSTE 100 on Friday alone! Although the result wasn’t what we expected, the fund managers were prepared for it.

That said, what about the future? What can we expect?

If we look at the long term, the first thing to say is there is massive uncertainty. Things are changing on a daily basis.

When we look at the short term, by that I mean the next 1-3 months, I think the Portfolios have largely done exactly what they should have done. It has protected us from the uncertainties in the market and we propose to make no dramatic changes to the Portfolios.

How do we see the future? I’ve got a sense that not a lot is really going to change. Life has carried on and the world is fundamentally the same, just the way that we deal with things that are going to have to change. Over the coming months and years, we’re going to do everything that we can do to protect your Portfolio, and to grow it in real terms. And of course, most importantly, we’re going to do everything we can do to help you enjoy the money that you’ve got!

Markets are already seeing positive gains from both Europe and the UK, with central banks now looking to step in to stimulate the global economy. It is important to note that central banks have been preparing for this scenario and they have the tools necessary to protect global growth. This means the opportunity to buy into the market at a lower point, is already closing and fast.

The Future

Looking forward, the Portfolios are positioned well and the key themes for future growth opportunities from our Fund Manager partners are:

  • Positive economic growth moving forward
  • US economy is stable and in good health
  • Reasonable global valuations offering growth opportunities
  • Central banks are prepared and ready to increase stimulus if necessary
  • Diversification allows for insulation from both external and localised events

As ever, if anyone has any questions or concerns, please do not hesitate to contact us.

 

Disclaimer

 

Your capital is at risk. Investments can fluctuate in value and investors may not get the amount back they invest. Past performance is not a guide to future performance. Tax rules can change at any time.

 

Please remember your home or property may be repossessed if you do not keep up repayments on your mortgage.  We give clients the option to pay for mortgage advice by fee rather than commission. Equity Release refers to lifetime mortgages. To understand the features and risks, ask for a personalised illustration.

 

The Financial Conduct Authority do not regulate, Will Writing, Buy to Let Mortgages, Auto Enrolment, Tax Advice and Estate Planning.

 

The opinions contained within this blog, do not constitute financial advice and no action should be taken based on this content alone.

Jasmine has been a qualified Financial Planner since 2008. She has also been a member of the Society of Will Writers since 2012. She is passionate about helping Clients build their wealth and achieve the financial lifestyle they desire. Her areas of expertise are that of Savings, Investments, Pensions and Retirement Planning.

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Redwood Financial Family Wealth & Estate Planners Ltd is Directly Authorised and regulated by the Financial Conduct Authority. FRN number 774469.

Disclaimers

The Financial Conduct Authority do not regulate, Will Writing, Buy to Let Mortgages, Auto-Enrolment, Tax Advice and Estate Planning. Your capital is at risk. Investments can fluctuate in value and investors may not get the amount back they invest. The guidance and/or advice contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK. https://register.fca.org.uk/

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Email: info@redwoodfinancial.co.uk

Company information

Redwood Financial Family Wealth and Estate Planners Ltd Company Number: 08926661
Registered Office Address: Wellesley House, 204 London Road, Waterlooville, Hampshire,