Investing before Brexit

hollie.weimeraner

My investments in a managed fund, have (this week) finally recovered all the losses experienced at the start of the year. I also have a chunk of cash that is earning little or no interest in a number of bank accounts and am wondering whether or not to put it into the investments.  The only concern I have is what is likely to happen in the event of a no deal Brexit?  I know we can't predict what's going to happen but would just like to garner a few thoughts before putting more cash in.

Voyager2002

I am reasonably confident that Brexit (no-deal or any other kind) will have little or no effect on the performance of investments in China. Come to that, the companies in the FTSE 100 (generally not a good choice) derive the bulk of their income from outside the UK and so again would neither benefit nor suffer from any kind of Brexit.

[Deleted User]

hollie.weimeraner said:

My investments in a managed fund, have (this week) finally recovered all the losses experienced at the start of the year. I also have a chunk of cash that is earning little or no interest in a number of bank accounts and am wondering whether or not to put it into the investments.  The only concern I have is what is likely to happen in the event of a no deal Brexit?  I know we can't predict what's going to happen but would just like to garner a few thoughts before putting more cash in.

There is only one certainty: in the event of a no deal brexit, sterling - currently $1.30 - will lose value in the world.
So, if you have assets denominated in £, like a house, salary or pension, you could manage that damage by investing in international stocks. 
Stick to the big ones: Aapl, Microsoft, AliBaba.

TBC15

ZingPowZing said:

hollie.weimeraner said:

My investments in a managed fund, have (this week) finally recovered all the losses experienced at the start of the year. I also have a chunk of cash that is earning little or no interest in a number of bank accounts and am wondering whether or not to put it into the investments.  The only concern I have is what is likely to happen in the event of a no deal Brexit?  I know we can't predict what's going to happen but would just like to garner a few thoughts before putting more cash in.

There is only one certainty: in the event of a no deal brexit, sterling - currently $1.30 - will lose value in the world.
So, if you have assets denominated in £, like a house, salary or pension, you could manage that damage by investing in international stocks. 
Stick to the big ones: Aapl, Microsoft, AliBaba.

What makes you think the pound will fall? (Sits back rubbing hands, will do me rather well)

Edit approximately how many bricks will the house be missing? If I was still in work what reduction in my pay would be expected? What reduction in my current pension can I expect?

aroominyork

If you have a well balanced portfolio not much will depend on our domestic economy. The only sensible question, as ZPZ suggests, is what happens to Sterling. So the questions are:
1. What has the market already priced in to the forex rate?
2. What is the likelihood of a hard or soft post-transitionary deal?
3. What will the effect of each of those outcomes have on Sterling?

As an example, my understanding is that the Wellcome Trust's investment manager (who, I heard from I forget whom, is paid much more than the Trust's Director) made a big bet against Sterling ahead of the referendum, perhaps on the basis that the markets expected a No vote, but there was a reasonable chance of a Yes vote and that would send Sterling tumbling. The winner was the Trust's work on global health.

Prism

We are investing for hopefully a good outcome in 10-20 years right? Why does the current exchange rate matter?

[Deleted User]

TBC15 said:

ZingPowZing said:

hollie.weimeraner said:

My investments in a managed fund, have (this week) finally recovered all the losses experienced at the start of the year. I also have a chunk of cash that is earning little or no interest in a number of bank accounts and am wondering whether or not to put it into the investments.  The only concern I have is what is likely to happen in the event of a no deal Brexit?  I know we can't predict what's going to happen but would just like to garner a few thoughts before putting more cash in.

There is only one certainty: in the event of a no deal brexit, sterling - currently $1.30 - will lose value in the world.
So, if you have assets denominated in £, like a house, salary or pension, you could manage that damage by investing in international stocks. 
Stick to the big ones: Aapl, Microsoft, AliBaba.

What makes you think the pound will fall? 

Edit approximately how many bricks will the house be missing? If I was still in work what reduction in my pay would be expected? What reduction in my current pension can I expect?

What makes me think the pound will fall? 
The way £ has performed for the last +4 years on Brexit news; every day confirming the market's judgement on the referendum: Brexit is economic poison. 

How many bricks will tbc's house be missing?
None. He will have the same number, they will just be worth less in the world.

What reductions in my current pension can I expect?
None in sterling terms; again, the£ figure will just be worth less in the world.

csgohan4

Depends on how much exposure your managed fund has, 

If your worried about the UK exposure, maybe consider diversifying more into an EM fund, or a S&P 500 tracker/ US fund or even a Europe Ex UK fund/ETF

Thrugelmir

US Presidential election is going to weigh on all the markets for the next 3 weeks or so. Also 3rd quarter reporting season for US major companies commences Tuesday 13th October.  
As far as Brexit goes. It's in the interest of both parties to thrash something out in terms of a trade deal. Will go all the way to the wire. 
Interesting times lie ahead. Markets hate uncertainty. 

Steve182

ZingPowZing said:

TBC15 said:

ZingPowZing said:

hollie.weimeraner said:

My investments in a managed fund, have (this week) finally recovered all the losses experienced at the start of the year. I also have a chunk of cash that is earning little or no interest in a number of bank accounts and am wondering whether or not to put it into the investments.  The only concern I have is what is likely to happen in the event of a no deal Brexit?  I know we can't predict what's going to happen but would just like to garner a few thoughts before putting more cash in.

There is only one certainty: in the event of a no deal brexit, sterling - currently $1.30 - will lose value in the world.
So, if you have assets denominated in £, like a house, salary or pension, you could manage that damage by investing in international stocks. 
Stick to the big ones: Aapl, Microsoft, AliBaba.

What makes you think the pound will fall? 

Edit approximately how many bricks will the house be missing? If I was still in work what reduction in my pay would be expected? What reduction in my current pension can I expect?

What makes me think the pound will fall? 
The way £ has performed for the last +4 years on Brexit news; every day confirming the market's judgement on the referendum: Brexit is economic poison. 

How many bricks will tbc's house be missing?
None. He will have the same number, they will just be worth less in the world.

What reductions in my current pension can I expect?
None in sterling terms; again, the£ figure will just be worth less in the world.

Me thinks the pound will fall too. Rate was about $4/pound during WW2, $2/pound 1st gulf war, $1.28 now. maybe $1/£1 about 10 to 15 years from now? That's one reason why 75% of my investments are in $

BuildTheWall

Prism said:

We are investing for hopefully a good outcome in 10-20 years right? Why does the current exchange rate matter?

This. Don’t change your long term investments on short term market moves. If you have some spare lying around that you want to use on a short term bet, that’s your choice.