The bookies are normally the place to look for forecasting but it seems to me the markets could be a better gauge. So is Brexit now favourite based on this weeks fall on FTSE?
Thoughts?
It hadn't diverged materially from other indices before today, and today's tantrum is not that big. The predictive value is reduced because it's a dynamic process: if markets collapse, some people will change their mind in response and therefore it will affect the outcome the market is supposed to predict...
Bookies are odds on for remain, personally I think turnout will be a big factor. The voters most likely to turn out are the ones that are motivated by Brexit.
Personally I firmly believe that no matter what the result is, we won't leave. There will likely be another referendum within 12 months and a "new deal" from the EU to get us to stay.
But then if Leave looks like it's leading, people who don't like change may panic and come out in droves...
I have hedged using SUK2 and not sold any holdings. Keen to know what others are doing..?
the bookies and the markets i think are very nervous , spreadbetting firms i know are tightening the margins for next few weeks or so , they are not trusting the opinion polls
my thoughts are that opinion polls will have big affect on the Brexit , referundum
if people think that the" in campaign" is going to win , voters might become complacent and not bother to vote or vice versa with the leave campaign
my opinion is that these opinion polls will seriously affect the out come of referendum
Prefacing this with Personally / and I may well be wrong / DYOR / YMMV / etc
If we exit, I see GBP falling against the USD / EUR. Some commentators say 10-20%.
Lots of companies sell in USD/EUR - notably oilers.
If this happens, the USD that oil companies earn will buy more GBP. Their market is a world market, a recession in the UK will have negligible impact. All other things being equal I would expect the GBP sp of RDSB/BP to rise about as much as the GBP/USD rate falls.
Lots of companies import from the US and Europe and sell to the UK, if what they are selling suddenly gets 10-20% more expensive, naturally, their profitability will be impacted negatively.
Lots of companies sell from the UK to the US and Europe, if what they are selling suddenly gets 10-20% cheaper, naturally, their profitability will be impacted positively.
Lots of companies do varying proportions of import / export (some car components are flown in and some are manufactured here and then the car is exported)
The index is made up of all types of company and many that are a bit of a mix.
The reverse applies if we remain - but I think the market is currently pricing in a remain result so the change in GBPUSD will be a lot less.
If anyone can accurately work out
(a) the referendum result
(b) the impact on the exchange rate
(c) model the impact on company profitability depending on the two results
(d) from that work out the impact on the FT index
and
(e) all the other things that are going on
to get an understanding of that particular index value - or starting from the index value the referendum result
Please dont tell me, but can I have an invite to your private island.
