- Britain’s referendum on the European Union resulted in a Brexit.
- Despite the panic, investors can wisely hedge portfolios and find safety.
- You’ll find incredible stock-buying opportunities; just wait for the dust to settle.
Brexit is a go, and the fallout is on. Here’s what this means for your portfolio…
Thursday night, Britain voted (by a narrow margin) to leave the European Union, the British Prime Minister resigned, and exit negotiations will begin immediately.
Now, Britain has two years to negotiate terms for leaving, giving U.K. companies and other companies with facilities and offices in the U.K. time to shift things to conform this new reality.
The level of uncertainty in the U.K. and Europe will be greater than at any time since the fall of the Berlin Wall in 1989.
Where does this leave investors?
Well, if you haven’t already hedged your portfolio, it’s never too late.
Good on you if you were able to reach your broker to sell those multinational stocks with huge exposure to Europe. For many investors, it didn’t happen. The computers are kicking, and brokers are scrambling.
Indeed, the post-vote theme is panic. What to do?
What’s the view long-game players will take? For them it’s a wait-to-buy period. Eventually the reality of the vote, its aftermath and consequences will kick in, and the potential for real stock values will unfold.
Consider best-of-the-best stocks that may see buying-opportunity value: Microsoft Corporation (NASDAQ:MSFT), Johnson & Johnson (NYSE:JNJ) are the only two U.S. companies with Standard and Poor’s ‘AAA’ rating.
Despite the Brexit fallout, both will weather the storm from a safety standpoint with fully intact financial strength. Look to both as buying opportunities when the dust settles.
Whatever you do, don’t panic. Unless you’re hedged against what you woke up Friday, or you have a direct line to your broker, sit tight. Wait out the damage. Look to your portfolio for opportunity.
Easier said than done? Yes. But it’s a hell of a better way to sally forth.
Stay smart and navigate the market easily—find out now how to stay on top of your portfolio, no matter what’s happening in the global markets.
(Marc Bastow is long MSFT and JNJ.)