The world looks different in the year since Great Britain voted to leave the European Union. Populist movements, terrorist attacks and other significant geopolitical risks have been causes for concern. The fallout had a lasting impact on U.K. equities and the pound. Should the exit from the EU pose significant barriers, both could see more devaluation.
Clawing back: The June 23, 2016, vote to leave the EU had its effect on equities. Returns since the referendum put U.K. equities in the red into the first quarter of 2017, not breaking even until late March.
Allocations down: Global money manager allocations to U.K. equities and bonds have declined slightly since the vote, but arre likely more of a function of market performance than a long-term view.
Pound's predicament: The pound declined 16.3% against the dollar and 13.6% against the euro in 2016, with the bulk of those declines coming before the Brexit vote.
Business as usual: The U.K. does half its trade with the EU, and quarter with Germany, France and Holland alone. A net importer from the EU, the U.K. saw deficits decline as the pound fell vs. the euro.
*Through March. **Germany, France and Holland. Sources:
Bloomberg LP, eVestment Alliance
Compiled and designed by Charles McGrath and Gregg A. Runburg