Good morning from the U.S.,
I wonder how many fundamental analysts could have “predicted” the market’s reaction to the Brexit news. It amazes me how many people still believe these “experts” on TV know what they are talking about. Hopefully some day people will learn that trend following is the only way to prepare for these 100-year floods that seem to happen quite often. Thank you for your podcasts and continuing to educate those who are looking for the right way to trade.
Michael D. Jr.
Let me add some relevant feedback from Sunrise Capital:
At a philosophical level, it is important to understand that while Brexit is in some respects novel and shocking (no country has ever left the European Union and many polls suggested that Britain would stay), from a broader perspective, Brexit is no different than any of the many exogenous geopolitical events that have periodically disrupted markets over the course of our 37 year investment history. As we see it, Brexit is simply another example of an “unexpected” event happening and investors overreacting to that event in such a way that it causes a great deal of immediate market turmoil.
The financial pain caused by this turmoil is real, it is not enjoyable and it is generally not good for the global financial system or people’s faith in that system, particularly in the short term. However over the long haul, as history has proven over and over again through world wars, revolutions, and numerous other types of global disruptions, markets are resilient and ultimately right themselves to some kind of equilibrium level. Accordingly, our approach to Brexit has been quite similar to the approach we’ve taken to numerous other global shocks and that is to plan, prepare and then “keep calm and carry on” as the British would say.