Special Update: UK to leave European Union

Brexit … What is it and how does it affect my investments?

By now, you will most certainly have heard that the United Kingdom has left the European Union (EU) and subsequently put all the financial markets into immediate turmoil. 

This is an historic event; one in which you should have many questions. How does this affect the global economy? How will this affect my investments? What investments are appropriate for times such as these? Our response to all of these questions is simply this … ‘patience grasshopper.’

We can speculate on how this will affect markets and the global economy in the short and long terms, but the reality is that it is too early to tell how this will ultimately play out. At this time we are not concerned that this will trigger yet another ‘financial crisis,’ but know we are watching things very closely. The next several weeks will be critical in determining the overall health of the global economy as this recent Brexit vote unfolds. We can tell you this: it will take time for the UK to unravel itself from the EU and I would not be a bit surprised if the Brit’s acknowledge a bit of ‘voters’ remorse’.   

What to do now?

Nothing. While this may turn into a short-term buying opportunity we are not recommending that clients react in any major way. We are advising everyone to sit tight and adopt a ‘wait and see’ approach. As a point of reference, we have had more than 75 market pullbacks or corrections of 5-10% since Dec. 31, 1945, with the average decline being more than 5%. The average length of this decline has been one month and the time to recover has been one month.[1]

As more information becomes available we will communicate the best course of action as it relates to this event, as well as the global economy.

Should you have concerns or questions please do not hesitate to contact us: 888-438-0688.

Until next time…..

 Darin & Blair