How to invest if you think there will be a post-transition deal with the EU

Thrugelmir

ZingPowZing said:

aroominyork said:

I'm not sure this falls into the usual 'avoid speculation' category. The issue will not drag - it will shortly be resolved one way or the other. It's a binary choice (though obviously with detail in the terms) and it looks to me like the markets are on the fence. So my question stands: if it was announced this week that issues of fisheries, state support etc. have been resolved and they are now working on final text, what would the currency and market responses be?

I think $1.30 speaks of the markets expecting some deal so unless it’s surprisingly comprehensive I don’t expect £ to rise above $1.35. 
In the case of no deal or, more likely, when U.K.  reneges on whatever the Johnson Govt agree now, I expect £ to dip below $1.20, so I wouldn’t be looking to get back into £ at this point.
You probably already have a house, salary, pension etc valued in £ anyway so would benefit indirectly from a sterling rally. 

Europe uses a mixture of Euro and local currencies not the US$. 
 

[Deleted User]

Thrugelmir said:

ZingPowZing said:

aroominyork said:

I'm not sure this falls into the usual 'avoid speculation' category. The issue will not drag - it will shortly be resolved one way or the other. It's a binary choice (though obviously with detail in the terms) and it looks to me like the markets are on the fence. So my question stands: if it was announced this week that issues of fisheries, state support etc. have been resolved and they are now working on final text, what would the currency and market responses be?

I think $1.30 speaks of the markets expecting some deal so unless it’s surprisingly comprehensive I don’t expect £ to rise above $1.35. 
In the case of no deal or, more likely, when U.K.  reneges on whatever the Johnson Govt agree now, I expect £ to dip below $1.20, so I wouldn’t be looking to get back into £ at this point.
You probably already have a house, salary, pension etc valued in £ anyway so would benefit indirectly from a sterling rally. 

Europe uses a mixture of Euro and local currencies not the US$. 
 

Well, yes, although the Euro is dominant. 
But sterling will move more against the US $ on the news; because no deal harms both £ and E.
And cable is still the dominant traded pair for London.

Thrugelmir

ZingPowZing said:

Thrugelmir said:

ZingPowZing said:

aroominyork said:

I'm not sure this falls into the usual 'avoid speculation' category. The issue will not drag - it will shortly be resolved one way or the other. It's a binary choice (though obviously with detail in the terms) and it looks to me like the markets are on the fence. So my question stands: if it was announced this week that issues of fisheries, state support etc. have been resolved and they are now working on final text, what would the currency and market responses be?

I think $1.30 speaks of the markets expecting some deal so unless it’s surprisingly comprehensive I don’t expect £ to rise above $1.35. 
In the case of no deal or, more likely, when U.K.  reneges on whatever the Johnson Govt agree now, I expect £ to dip below $1.20, so I wouldn’t be looking to get back into £ at this point.
You probably already have a house, salary, pension etc valued in £ anyway so would benefit indirectly from a sterling rally. 

Europe uses a mixture of Euro and local currencies not the US$. 
 

Well, yes, although the Euro is dominant. 
But sterling will move more against the US $ on the news; because no deal harms both £ and E.
And cable is still the dominant traded pair for London.

If Biden wins the election and the Democrats take both houses. Then Brexit may not be the main agenda in 2021. 

[Deleted User]

Thrugelmir said:

ZingPowZing said:

Thrugelmir said:

ZingPowZing said:

aroominyork said:

I'm not sure this falls into the usual 'avoid speculation' category. The issue will not drag - it will shortly be resolved one way or the other. It's a binary choice (though obviously with detail in the terms) and it looks to me like the markets are on the fence. So my question stands: if it was announced this week that issues of fisheries, state support etc. have been resolved and they are now working on final text, what would the currency and market responses be?

I think $1.30 speaks of the markets expecting some deal so unless it’s surprisingly comprehensive I don’t expect £ to rise above $1.35. 
In the case of no deal or, more likely, when U.K.  reneges on whatever the Johnson Govt agree now, I expect £ to dip below $1.20, so I wouldn’t be looking to get back into £ at this point.
You probably already have a house, salary, pension etc valued in £ anyway so would benefit indirectly from a sterling rally. 

Europe uses a mixture of Euro and local currencies not the US$. 
 

Well, yes, although the Euro is dominant. 
But sterling will move more against the US $ on the news; because no deal harms both £ and E.
And cable is still the dominant traded pair for London.

If Biden wins the election and the Democrats take both houses. Then Brexit may not be the main agenda in 2021. 

The Brexit project is crippled if Biden wins.

jimjames

aroominyork said:

OK, I'll ask the question another way. The Wellcome Trust (which is the world's second largest medical research philanthropic donor after Gates) made a huge gain on the 2016 referendum because, as their Trustees' report explained: “Tactically, we viewed the risk to sterling from the referendum to be asymmetric and reduced our sterling exposure (including hedges) to an all-time low ahead of the vote." So they were not necessarily predicting the outcome of the vote but thought Remain was pretty much priced into Sterling while Leave would see Sterling fall significantly. What do people think the impact on Sterling will be of deal and of a no deal outcome over the coming two months? 

Thing is a deal will be better than no deal but the deal being discussed is still significantly worse than the status quo. Anything that introduces customs checks, additional red tape and restrictions on business will not help companies long term and even short term will have a hit. That's the scenario with a deal. No deal will be worse but I don't think it will have much impact on markets.

Thrugelmir

ZingPowZing said:

Thrugelmir said:

ZingPowZing said:

Thrugelmir said:

ZingPowZing said:

aroominyork said:

I'm not sure this falls into the usual 'avoid speculation' category. The issue will not drag - it will shortly be resolved one way or the other. It's a binary choice (though obviously with detail in the terms) and it looks to me like the markets are on the fence. So my question stands: if it was announced this week that issues of fisheries, state support etc. have been resolved and they are now working on final text, what would the currency and market responses be?

I think $1.30 speaks of the markets expecting some deal so unless it’s surprisingly comprehensive I don’t expect £ to rise above $1.35. 
In the case of no deal or, more likely, when U.K.  reneges on whatever the Johnson Govt agree now, I expect £ to dip below $1.20, so I wouldn’t be looking to get back into £ at this point.
You probably already have a house, salary, pension etc valued in £ anyway so would benefit indirectly from a sterling rally. 

Europe uses a mixture of Euro and local currencies not the US$. 
 

Well, yes, although the Euro is dominant. 
But sterling will move more against the US $ on the news; because no deal harms both £ and E.
And cable is still the dominant traded pair for London.

If Biden wins the election and the Democrats take both houses. Then Brexit may not be the main agenda in 2021. 

The Brexit project is crippled if Biden wins.

The world simply moves on. 

stephenadarglas

Yes @thrugelmir next year it will be something else affecting or improving our lot financially.

Sailtheworld

Thrugelmir said:

Europe taken as a whole isn't in a good place either. Now is the time for the political project to come to the fore. As fiscal integration is the only way forward. Will it work though?  Challenging times are ahead. 

The world simply moves on...

Thrugelmir

Sailtheworld said:

Thrugelmir said:

Europe taken as a whole isn't in a good place either. Now is the time for the political project to come to the fore. As fiscal integration is the only way forward. Will it work though?  Challenging times are ahead. 

The world simply moves on...

Only worth concerning yourself with matters over which you have influence or control. Otherwise observe neutrally. 

Time4T_Accounts

Thrugelmir said:

Europe taken as a whole isn't in a good place either. Now is the time for the political project to come to the fore. As fiscal integration is the only way forward. Will it work though?  Challenging times are ahead. 

A Lib Dem door stepper in the run up to the last general election was oblivious to the need for fiscal integration for the EU project to work. I found his lack of knowledge alarming!