There is no doubt that if you have been paying attention to the news in the last several weeks, you have been hearing a great deal of discussion about “The Brexit”. Opinions on this historic vote have been swift, diverse, and contentious. Politicians, economists, and public figures throughout Europe and the world have been campaigning doggedly on whether to stay or leave for months, and now that the vote is in, the focus has shifted to try to analyze what this means going forward.
We certainly saw the impact of the Brexit vote reflected in investor uncertainty and market volatility immediately following the decision, and we are concerned with the rhetoric surrounding the situation. While it is to be expected that a story of this nature will dominate the media, it is important to take all the noise, claims, and discussion with a grain of salt. The reality is that no one knows what the long-term impact of the Brexit will be on the global economy and as such, bold predictions and rash decisions should both be approached with caution.
Anytime a major event dominates the news headlines, the Vance Wealth Group team’s approach is to force ourselves to remove emotion from the equation and take a big picture view. What is the long term impact of this event? Does this change the way we view investment management moving forward? When we become hyper-focused on a singular headline, it is easy to overreact to short term news. Any overreaction can lead to poor investment decisions. This is why it is critical for us to consider all new information in its global context to determine if we are dealing with a “crisis du jour,” or a significant market event which requires more thoughtful attention.
We have carefully and thoughtfully designed our clients’ investment strategies in anticipation of uncertainty. In times like these, knowing you have a plan in place allows you to separate emotional reactions from important investment decisions.
We are not going to be over reactionary to the news out of Britain. Instead, we choose the more rational approach, where fear does not guide our decisions and we will look for opportunities in the market to take advantage of irrational reactions to recent headlines. Just remember, this is a reason why we diversify your assets.
All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such. Vance Wealth, Inc. (“Vance Wealth”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where Vance Wealth and its representatives are properly licensed or exempt from licensure.