Why Investors Should Ignore Brexit and Focus on Stocks

Management is paid by shareholders to make money in all environments – so focus on the areas of the markets which offer good value

External Writer 29 June, 2016 | 3:27PM
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Morningstar's "Perspectives" series features investment insights from third-party contributors. Here, James Klempster, Head of Portfolio Management at Momentum GIM on why we should be making the most of the Brexit situation.

The UK and Europe can be forgiven a brief period of soul searching, but protracted self-pity is not in anyone’s interest. Ultimately the public have spoken and regardless of one’s view of the result it is incumbent upon everyone in Europe – businesses, politicians and consumers alike – to do their utmost to make the best of it.

Business’ natural inclination is to do just that – management is paid by shareholders to make money in all environments – but while there is such great uncertainty over the region it is understandable that businesses may sit on their hands. Doing so raises the spectre of a recession both in the UK and on the continent and as a result we would do well to see the politics settled as soon as possible. We will also likely see further intervention from central banks, but arguably we have seen diminishing returns on their actions for the past couple of years already.

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