Finsbury Growth & Income Brexit Deal

MichelleN

I am invested in FGT and was wandering whether shares in this trust would benefit from a Brexit deal or would it be detrimental? Same question really for other UK funds/trusts. 

Prism

I think it would be fair to say that almost all UK companies would benefit in some way from a Brexit deal. Lower tariffs and less paperwork is a good thing for importers and exporters. 

MichelleN

Prism said:

I think it would be fair to say that almost all UK companies would benefit in some way from a Brexit deal. Lower tariffs and less paperwork is a good thing for importers and exporters. 

Even the FTSE 100 companies that trade in US Dollars? Wouldn’t they suffer with the renewed strength of the pound?

Moe_The_Bartender

Nick Train is buying.

http://citywire.co.uk/funds-insider/news/nick-train-valuation-of-my-uk-blue-chips-looks-ridiculous/a1427844

Prism

MichelleN said:

Prism said:

I think it would be fair to say that almost all UK companies would benefit in some way from a Brexit deal. Lower tariffs and less paperwork is a good thing for importers and exporters. 

Even the FTSE 100 companies that trade in US Dollars? Wouldn’t they suffer with the renewed strength of the pound?

Which Finsbury Growth holdings trade in US Dollars primarily? Mondelez certainly. Any others? What ratio to they import to export goods from the rest of the world? What ratio of their business come to and from Europe? What long term effect would lets say a 20% drop in the pound have on the long term earnings for these companies? What could those companies do being global to reduce the effect of that currency movement? How much of that is already priced in?

If anyone can answer those questions then they may have a better idea of exactly what might happen to the trust share price. I doubt you will find a single one of the CEOs of those companies saying that they want no deal.

MaxiRobriguez

MichelleN said:

Prism said:

I think it would be fair to say that almost all UK companies would benefit in some way from a Brexit deal. Lower tariffs and less paperwork is a good thing for importers and exporters. 

Even the FTSE 100 companies that trade in US Dollars? Wouldn’t they suffer with the renewed strength of the pound?

Difficult to determine the impact of forex change vs the reinclusion of UK tracker funds in foreign investors portfolios as they seek to obtain a cheap index before forex changes work against them.

Standard guidance about "part of a balanced portfolio" probably applies here for the OP. As long as the portfolio is diversified then nothing to worry about if you have a UK allocation. 

Sally57

IMHO, FTSE 250/350 UK smaller companies will benefit more from a trade deal than large cap UK funds such as FGT.

MonroeM

I would have thought FGT will benefit from a brexit trade deal. Top holdings such as Unilever and Diageo will not gave to pay export tariffs in the Eurozone so surely that should benefit them?

MPN

Unilever shares up over 5% yesterday so decent day’s trading for FGT.

MichelleN

Sally57 said:

IMHO, FTSE 250/350 UK smaller companies will benefit more from a trade deal than large cap UK funds such as FGT.

In general, most UK companies (from large to small caps) would benefit from a trade deal with Europe.