Since the beginning of the Brexit saga, the sterling pound has been severely hit several times, progressively losing its value to the US dollar starting on 2016 March. The pound showed signs of recovery during Mrs May’s term. Brexit news put it down every time, including the Mr Johnson’s latest promise of Brexit delivery be it no deal or whatever.
As Bloomberg recently pointed out, bets for currency volatility are growing fast. Simultaneously, the net equity supply to the UK stock market is record low since 2009, according to the Citi Research. The situation looks dire for the stock exchange since companies are increasingly not willing to go public in the UK.
What signals does this situation send to the informed investor? Diversification into private equity markets looks like a valid option. Like we wrote earlier, London prime real estate market shows no unhealthy signs; the same stays true for the commercial real estate market. Buying real estate while the pound is low is a lucrative option for families who want to diversify assets and increase exposure to real estate.
Imports will become more expensive for British companies, which also create market opportunities in commodity stocks. The weak pound is good for exports and Scotland will have its momentum with whisky trade going up.