How have investments done since the Brexit vote?

Font size

0
0
0
0

It’s almost a year since the vote to leave the European Union. Which investments have done well and which ones have fared the worst?

FTSE 100

The FTSE 100 was at 6,338.10 when it closed on June 23rd, the day of the Brexit vote. The next day it fell sharply, but recovered some of the ground it had lost to close at 6,138.69.

Since then, it’s risen strongly. Today it closed at 7,523.81. However, it reached 7,562 on June 5th (its highest point), but its highest closing value was on June 2nd when it reached 7,547.63.

The FTSE 100 is a reflection of the value of the UK’s 100 largest companies. It doesn’t take into account any return you would receive from dividends. Research by Fidelity International shows that if you’d invested £10,000 into the FTSE 100 on 24th June last year – the day after the Brexit vote – your investment would now be worth £12,565, which is an increase of 26%.

SAVVY TIP: Dividends are a percentage of the profits that a company makes. If a company decides to pay dividends, they are paid out twice a year. You can find out more about dividends in my video, called Share dividends explained.

Overseas share-based investments, bonds and cash

If you’d invested your money in overseas investments, bonds or in a savings account, your return would have varied according to what your money was invested in.

These are all figures from Fidelity International, they assume that you’d reinvested your dividends (namely, used them to buy more shares, rather than taking them as income) and they don’t include the effect of charges.

  • Asia Pacific: If you’d invested in shares in companies based in the Asia Pacific region (which includes Australia, Hong Kong, Japan and Singapore), on June 24th, your investments would have increased by almost 37%.
  • Emerging Market: If you’d invested in shares in companies from the emerging markets, your investments would have increased by over 36%. There are a number of emerging markets, from Brazil and Mexico to India, Malaysia and Turkey.
  • Europe: If you’d invested in shares in companies based in Europe (but not including the UK), your investments would have increased by almost 36%.
  • Japan: If you’d invested in shares in companies based in Japan your investments would have increased by over 31%.
  • Global: If you’d invested in shares in companies based around the world your investments would have increased by over 31%.
  • United States: If you’d invested in shares in companies based in the United States, your investments would have increased by over 30%.
  • High yield bonds: If you’d invested in high yield bonds (these are IOUs for loans to companies that are seen to be relatively risky) your investments would have increased by over 20%.
  • Emerging Market debt: If you’d invested in loans to companies based in the emerging markets, your investments would have increased by almost 16%.
  • Property: If you’d invested in property your investments would have increased by over 14%.
  • Company bonds: If you’d invested in company bonds (these are IOUs for loans to companies that are not seen as such high risk as high yield bonds) your investments would have increased by almost 10%.
  • Inflation-linked bonds: If you’d invested in inflation-linked bonds (these are IOUs for loans to the government where the income you receive and the value of the bond is linked to inflation), your investments would have increased by over 8%.
  • Government bonds: If you’d invested in government bonds (these are IOUs for loans to the government), your investments would have increased by over 2%.
  • Cash: If you’d put your money in a savings account your savings would have increased by 0.44%.
  • Commodities: If you’d invested in commodities (such as oil, precious metals etc) your investments would have decreased by over 0.1%.

What does this mean for you?

It’s a cliché to say that past performance is not an indicator of future returns, but it is true. You can’t assume that just because a certain area or sector has performed well in the last 12 months, it will continue to do so. Also, we haven’t yet had Brexit. We’re only at the very beginning of negotiations so we have no idea of the kind of deal we might get when we do leave.

If you have a collection of investments that you’ve built up over the years, it may be worth reviewing them – either on your own or with the help of a financial adviser. It’s worth doing regularly anyway, and may be worth doing if there’s a major change in your own circumstances or in the UK or global economy.

Related articles: 

What is the FTSE 100 index?

What is a stock market or stock exchange? How can you invest?

Investment jargon buster – investment terms explained

SavvyWoman email newsletters: If you found this information useful why not sign up now to receive free fortnightly email newsletters with money saving tips and help? You can sign up at the top of any page on the website and your details won’t be passed to any other company for marketing purposes.