Our deputy chief investment officer, Chris Leyland, offered the following insights into our investment outlook following the UK general election.
“The overwhelming message is that it is essential not to over-react. We live in an uncertain world, and by diversifying your investments, there is a proven way to reduce risk and volatility.
“We believe that investing in well-diversified portfolio gives investors the best chance smoothing out any volatility, helping them to achieve their long-term goals. Our True Potential Portfolios are one of the most diversified, agile investment products available right now and are designed for precisely this type of volatile environment. We see no reason to shift our position.
“The unexpected outcome of the UK election underpins our view that market volatility will be higher than current lows. In anticipation of this, some of our investment partners reduced exposure to both traditional equities and bonds back in February, in favour of alternative strategies that should do well regardless of market direction.
“UK markets opened in a similar way to how they performed following last year’s Brexit referendum. Sterling has declined against the major currencies, but the weakness in currency is a boost to those companies generating earnings from overseas. The UK stock market is much less reliant on the domestic economy than in previous cycles.”
With investing, your capital is at risk. Investments can fluctuate in value and you may get back less than you invest. This information is not personal financial advice.
Your capital is at risk. Investments can fluctuate in value and you may not get back the amount you invest. Past performance is not a guide to future performance. Tax rules can change at any time.