June 24, 2016
An Important Email from SWP’s CEO:
Dear SWP clients:
I have just finished listening to multiple conference calls on the UK’s vote to exit the European Union (several financial analysts participated in the call, including one from the UK.), and wanted to share some of my thoughts with you.
As I listened to the many varying opinions on how the “Brexit” will affect different financial markets, I found only one point on which all analysts agreed, that being that no one knows the long-term effect of the Brexit on global trading and the markets in general, whether in the US or abroad.
There are many factors that will determine how the Brexit will ultimately affect the world markets, including the following:
- It will take several months of preparation before the UK formally withdraws from the EU.
- No one knows how the EU will respond to the withdrawal.
- Other EU countries, perhaps Denmark and The Netherlands, may also withdraw from the EU.
- The UK will have to re-negotiate its trade relationship with other EU countries, which negotiations will likely be protracted.
- No one knows how the UK stepping away from the EU will affect its own economy and that of other markets, including the US markets.
The reaction from global stock markets today was sharply negative, falling between 3% and 12% today. During times like this we would like to remind you that your portfolio is diversified across assets and investment strategies. So while the stock component of your portfolio no doubt performed poorly today, there are other investments in your portfolio that were positive today.
At Strategic Wealth Planning, we remain committed to the dual objectives of mitigating risk and attaining steady growth. Since no one can foretell the future, we maintain exposure to assets and strategies that will perform well during strong economic recovery, some that will perform well in a continued tepid recovery, and some that will likely perform well during recession or economic collapse.
As always, please feel free to contact me if you have any questions or comments.
Stephen Blum, CFP, AEP, CLU, ChFC