Brexit

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IlliniDave
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Brexit

Post by IlliniDave »

I'm surprised this topic hasn't come up (at least nowhere I've seen) as it seems a great launching point to predict all sorts of immediate financial mayhem (if you are inclined to believe those in the business of forecasting financial mayhem).

For my part I'm about 25% invested overseas, and I'd guess half that is in the European Union. It appears "remain" is the current odds-on bet as things have settled somewhat, but I don't know that it's a sure thing. I'm intending to just ride it out.

jacob
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Re: Brexit

Post by jacob »

The potential mayhem has pretty much been illustrated in the past two weeks. The market and USD/EUR are currently moving based on [the change in the] predictions of the Brexit outcome. So far polls show that it's increasingly less likely to happen which is why the markets recovered on Monday. If it does happen anyway, expect the USD to jump (so int stocks will go down in dollars as will commodities) and US markets to go down.

Ydobon
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Re: Brexit

Post by Ydobon »

I was starting to think that y'all didn't care about us in Britishland! :lol:

FTSE is back up to 6300 or so, but I'd imagine that there's a reasonable bit of upside to a remain vote. Will probably take a punt on a suitable ETF tomorrow with the intention of making a little beer money. If there is a leave vote, my portfolio will be punished in any case, so willing to take a gamble.

If leave actually happens I will a) be surprised b) quickly start getting my hands on as much cash as I can to invest. Call it national pride/snobbery, but I honestly think that the UK punches above its weight and has a lot going for it, I can't see the long term fallout of either choice turning the country into a barren wasteland.

Ps. In retrospect, I should have voted to remain in the Scottish referendum as well.

vexed87
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Re: Brexit

Post by vexed87 »

Yep the FX market has been quite volatile, I know as I had to try time my honeymoon currency around the poll announcements which has made the whole process a little more interesting than usual!

I timed my purchase of USD pretty well, just before the last dip but now I'm kicking myself for not holding out a little longer. Still, if the vote goes to leave, I'll be glad I coughed up when I did.

For what it's worth, the libertarian in me compels me to vote leave, but I am betting on a remain vote when all the ballots are counted.

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Bankai
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Re: Brexit

Post by Bankai »

Quite an interesting article in Independent:

http://www.independent.co.uk/news/uk/po ... 93971.html

Hjalmar Kvam, the head of pre-match at William Hill, told The Independent he personally thought the real chances of Britain voting to stay in were 86-87 per cent, making a Remain victory more likely than even current odds would suggest. But he revealed that the evidence wasn’t all one way. While 75 per cent of the total money bet at William Hill had gone on Remain, he said: “In terms of the actual numbers of bets made it’s the other way round: 75 per cent of bets on Leave and 25 per cent on Remain.”

The most sceptical bookie was Matthew Shaddick, head of political betting at Ladbrokes – and even he was making Remain the odds-on 2/5 favourite in February, when the average of opinion polls suggested the referendum was too close to call.Mr Shaddick explained that while professionally he set odds according to the amounts being staked on either Leave or Remain, “when it comes to my personal opinion, I think the betting markets are overconfident of Remain’s chances. They should still be favourites, but personally, I would put Remain’s chances at [only] 67 per cent.”The betting markets weren’t infallible, he said. Gamblers were unrepresentative of the electorate as a whole because they were more likely to be men, and “there is a massive amount of wishful thinking. People tend to bet according to what they want to happen.”


After leading the polls for about a week, Leave site took a hit in last few days due to the murder of Labour MP Jo Cox. Here's the link to poll tracker with 2 most recent polls from today giving Leave a lead again:

https://ig.ft.com/sites/brexit-polling/

Inertia is very difficult to overcome with Remain being pictured as a 'safe' bet. This might be decided by the number of people getting scared and voting 'leave' on last minute against 'closet' leavers who don't admit how they'll vote due to fear of being labelled racists, xenophobes etc.

saving-10-years
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Re: Brexit

Post by saving-10-years »

Most of the polls are very close. This one (cited here: http://www.bbc.co.uk/news/uk-politics-e ... m-36271589 ) used an interesting question. Not how you would vote but how you would feel if it were a remain/leave outcome ...
ComRes has also published an interesting poll for the Independent and Sunday People, although not with referendum voting intention figures.

It asked people about the emotions they would feel depending on the referendum outcome.

Significantly more people said they'd be delighted if Leave wins (44%) than if Remain wins (28%).
The Economist explains why we should think beyond the raw poll stats: http://www.economist.com/blogs/graphicd ... ferendum-0

This household is split. One leave, one remain and one undetermined. It feels too close to call. I'm listening to the TV debate here (calling each other liars - how useful).

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Bankai
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Re: Brexit

Post by Bankai »

saving-10-years wrote:I'm listening to the TV debate here (calling each other liars - how useful).
Both sides are interested in winning, not in the truth. No holds barred. I gave up watching political debates years ago.

ducknalddon
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Re: Brexit

Post by ducknalddon »

Bankai wrote:
saving-10-years wrote:I'm listening to the TV debate here (calling each other liars - how useful).
Both sides are interested in winning, not in the truth. No holds barred. I gave up watching political debates years ago.
Yes, I haven't watched any of the debates, in fact I haven't really followed the news at all since the referendum was announced.

Egg
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Re: Brexit

Post by Egg »

Much as I enjoy the political theatre, I'll be very surprised if the vote doesn't go the way of Remain.

jacob
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Re: Brexit

Post by jacob »

Early counts look like it's about to happen anyway ... if so we'll be going back to the forcing-situation as it was last week on a more permanent basis.

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Bankai
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Re: Brexit

Post by Bankai »

Vote seems decided now (Brexit leads by 632k right now with bookies odds 83-92% for brexit) so the next question is how to approach a portfolio when market opens. I'm personally going to sell housebuilders first thing in the morning as they are going to suffer the most.

jacob
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Re: Brexit

Post by jacob »

GDP/USD down 8.5%, Asia down ~3% (China not so much though), SP500 futures down 3.5%, gold up 4%+, US treasury yields down

(most of this is due to arbitrage from currency moves).

http://www.kitco.com/charts/livegold.html (watch this one!)

Edit: Never mind the exact numbers above. Twenty minutes later they're already more extreme. Kitco seems to have broken down. There's going to be "blood in the streets" tomorrow.

BRUTE
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Re: Brexit

Post by BRUTE »

may humans live in interesting times

TopHatFox
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Re: Brexit

Post by TopHatFox »

Oo Oo, does this means US stocks will temporarily plummet? I have some $ I want to buy stock things with.

#EMH #BFFTriangles #DIYbnr

IlliniDave
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Re: Brexit

Post by IlliniDave »

Well, there goes all of this year's profits in the stock markets. Poof. And I just hit my all-time peak yesterday. The Universe does not want me to retire early! Or at least the Brits don't. Almost all my buys this year and more than half of last year's have been USD-denominated bonds. Do I have the courage to "rebalance" into stocks today?
Last edited by IlliniDave on Fri Jun 24, 2016 5:37 am, edited 1 time in total.

stayhigh
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Re: Brexit

Post by stayhigh »

Well, I put some spare cash to hedge brexit and bremain at the same time and I did well - so far 14% up. Let's wait for US markets.

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fiby41
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Re: Brexit

Post by fiby41 »

1947 was the best Brexit IMO... but kudos for leaving something for good on your own initiative.

cmonkey
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Re: Brexit

Post by cmonkey »

ooofta! Too bad I've nothing to buy right now.

Dragline
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Re: Brexit

Post by Dragline »

Zalo wrote:Oo Oo, does this means US stocks will temporarily plummet? I have some $ I want to buy stock things with.
Well. Yes.

And maybe time to sell some gold and LT treasuries if you now find yourself overweighted in those.

I think the short-term action is just noise. But the long-term is very uncertain as this unwinds. A lot of large projects may be put on hold pending some clarity, which would cause a short-term recession in the UK and with people who do business there. But if the pound readjusts a lot lower, you could see some manufacturing eventually moving to England and even "gasp" a bit of inflation as a "new normal" sets in in a couple years. Note this is all just idle speculation on my part.

I am wondering what the overall U.S. reactions will be -- I think many are surprised here and don't know quite what to make of it. Certainly a "Fourth Turning" kind of event. Cameron is resigning.

tommytebco
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Re: Brexit

Post by tommytebco »

Sheesh!! Most of the problems in the world can be laid to the fact that there are too many Lawyers and news people.
As I understand it, there are at least two more steps before this actually happens (or doesn't). Unless you are day trading on margin, here should be nothing to worry about. It may even cause some buying opportunities. I read that the Britain % of US imports totals 5% or less. That trade isn't going to stop, just get more complicated for a while.
The speculators among us thrive on rumor and exaggeration. Stay calm, take a deep breath and carry on saving.

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