- Pound and Footsie crash in immediate wake of Brexit vote
- 'Take a deep breath', top financial pundit tells investors
- 'I urge investors not to panic,' says leading broking firm
- Three top tips: Do nothing, review your goals and look for opportunities
- Short-term volatility expected but long-term benefits could be delivered
The UK's momentous vote to quit the EU has sparked warnings from investing experts to sit tight and avoid booking losses during the immediate market panic after the shock result.
The pound crashed nearly 10 per cent overnight and the FTSE 100 opened 8 per cent or 488 points down at 5,849.9 down after the close 52-48 per cent vote in the EU referendum.
'Markets dislike uncertainty and they now face this in spades. However, this is a moment for investors to take a deep breath and focus on their long-term investment goals,' said Tom Stevenson, investment director for personal investing at Fidelity International.
Stay calm and carry on: Investor urged not to panic sell and to focus on long-term goals after vote to quit EU
'As hard as it may be right now for investors to remain calm, it is important to remember that market volatility is a normal part of long-term investing and with the benefit of hindsight some of the most turbulent times in stock market history are barely visible on a chart of the market’s ups and downs.
'Over time the risk of holding equities is usually rewarded and markets invariably overshoot in both directions.'
Michelle McGrade, chief investment officer at TD Direct Investing, said: 'I urge investors not to panic by the initial shock and focus on the longer term because it’s never been right to sell at bottom of markets.
'The world isn’t ending, it's changing with new challenges and opportunities – let’s today not forget the opportunities. Markets are forward looking, the dust will settle and investor confidence will return.'
Adrian Lowcock, head of investing at AXA Wealth, said: 'Times of uncertainty will knock investor confidence as they see falling share prices and panicked experts predict doom and gloom. This leads to making quick and often irrational decisions, such as selling after the market has fallen.
'Companies will adjust and the British economy will adapt. Investors need to look through all the noise and remain focused on their personal goals. Any sell-off will produce opportunities for prudent investors looking at the big picture and focused on the longer term.
'A weaker sterling will help the UK become more competitive and could boost the earnings of many of UK’s large companies where the bulk of profits are made overseas.'
He offer three basic tips for investors: do nothing, review your goals and look for opportunities.
Richard Stone, chief executive of The Share Centre, said: 'At a personal level a majority of investors may welcome the result as it meets with the wishes a majority indicated to us in our recent customer surveys. However, it is likely in the short term to result in increased market volatility amid uncertainty over what a vote to leave will mean for the UK.
“That negative short-term outlook may soon be reversed for those companies which will benefit from their exports being more competitive or their overseas earnings being more valuable in sterling terms.
'Investors will need to be sure-footed in identifying those companies which may benefit from the outcome of the vote and look for opportunities where whole sectors have been written down without any meaningful differentiation between companies to reflect the variation in impact the vote will have. The market will return to valuations based on fundamentals in due course.'
Jason Hollands, managing director of wealth management group Tilney Bestinvest, said: 'Investors will be looking for words of reassurance and coordinated action from central bankers to demonstrate they have prepared for this eventuality and that they will provide the necessary liquidity to shore up the financial system in the immediate aftermath.
'It's also imperative that politicians, in particular the Chancellor, George Osborne, rapidly reign back from some of the recent alarmist campaign rhetoric, to one that is more measured in tone and does not stoke further panic.
'Investors are going to need to hold their nerve through the coming days. Although the scale and rapidity of the slide in sterling is enormous, the UK has previously endured sharp devaluations in sterling before, notably following the ejection of the pound from the European Exchange Rate mechanism and in the aftermath of the banking crisis. While painful at the time, both were followed by periods of economic expansion.'
*Source Dailymail.co.uk
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