Possibly stupid question

frenchplonka

Ok so brexit is on the horizon my question is assuming you didnt start in vesting x number years ago would you rather invest on the day of brexit being real when the markets COULD take a battering or would you start now and see your portfolio tank.

I dont follow the news so im not to sure when the split will happen but surely its worth buying a bunch of shares in the months after brexit as opposed to buying now.

I know the argument is if u invest now then come brexit u can buy more at a discount but you also suffer a real loss assuming the market does tank

bowlhead99

There isn't 'a day' at some point in the future of Brexit being real. There will be a long protracted period with material uncertainties. The period has already started, with companies having to make commercial decisions on recruitment and investment without knowing the final laws and trading and immigration rules to which they will be subject in future.

Once you get to the last day of the process many years down the line with every last international trading agreement signed, every law rewritten and the public deciding a new government to run our new country (whether that's a brave new world... or quite close to business as usual), then Brexit uncertainty will be cleared and there will be some other uncertainty to fret about instead. But by the time you get there, a lot will have happened and the share prices will no longer be factoring in the Brexit uncertainty. If you wait 'til then to buy, you may be paying 2x today's price.

You mention you don't follow the news. However, the trillions of pounds and euros and dollars that make up the world markets with supply and demand to buy or sell shares and investment funds, are controlled by people who do follow the news. All the prices reflect their projections about the future. If the market thinks the prices should fall or rise in the future, they will do that now - as the market participants place their multi billion dollar bets. So, if you think that you (a person who doesn't even follow the news) will be able to "outwit" the market and make a nice easy gain that nobody else has spotted, you are dreaming.

AlanP_2

Which market are you thinking may tank?

US
Europe
Japan
Emerging Markets
Frontier Markets
Asia ex Japan
UK


to name but a few!


General advice is to spread your investments - diversification - so your pot doesn't "tank" if Boris has a bad day at the office.

EdGasketTheSecond

It would be primarily the UK, then Europe affected. You don't need to be an IFA to work that one out surely?

[Deleted User]

Hi,

well here's what the FTSE 100 has done since the Brexit vote, from 23/06/16 until today.

frenchplonka

I get what people are saying but would most of us agree UK shares and euro ones could tank or are pretty likely i mean im not invested yet so doesnt matter but i guess the flip ios true the share price now could be 2x more expensive on brexit so its a gamble

grandst

You know about it and so does every other investor, it's already in the price.

bigadaj

frenchplonka wrote: »

I get what people are saying but would most of us agree UK shares and euro ones could tank or are pretty likely i mean im not invested yet so doesnt matter but i guess the flip ios true the share price now could be 2x more expensive on brexit so its a gamble

As someone based in the uk then the other major unknowable is the exchange rate. Markets not denominated in sterling could go up and the bake fall in sterling terms, or vice versa, as a function of the exchange rate as we've seen since the Brexit vote and in the opposite direction over the last week or so.

Gadfium

[Deleted User] wrote:

Hi,

well here's what the FTSE 100 has done since the Brexit vote, from 23/06/16 until today.

Which pretty much tracks the devaluation in Sterling. The majority of FTSE100 companies have substantial trade in foreign currencies, so as Sterling devalues they becoming more valuable when measured in Sterling. In other words, you have more Sterling, but it's worth less.

AnotherJoe

frenchplonka wrote: »

I get what people are saying but would most of us agree UK shares and euro ones could tank or are pretty likely i mean im not invested yet so doesnt matter but i guess the flip ios true the share price now could be 2x more expensive on brexit so its a gamble

No they wouldn't

As said, things are factored in already. If you thought prices would jump or fall dramatically on Feb17 2019 (date made up) you wouldn't take action on Feb16, you'd take it now. So nothing at all will happen on the day after or the day before. It's already happened.

In any case as someone else posted, it's likely to be a long drawn out affair of transitional arrangements so nothing special will happen on the day.

enthusiasticsaver

Brexit is already factored into prices. It is not a surprise that at some point the UK will leave the EU so markets are adjusting all the time. Anyone with any investor sense is not only investing in the UK and EU anyway.