Is Your Portfolio Positioned to Beat the "Brexit"?

[Personal Capital] [Sign In] Is Your Portfolio Positioned to Beat the "Brexit"? [Find Out Now] Yesterday, the British people shocked the world by voting to leave the European Union, a "Brexit". With the news hitting markets overnight and this morning, we've seen a spike in traffic to the Personal Capital app. Not surprisingly, users like you want to know how this is affecting their investments. We want to provide you some commentary. While surprising, and painful for anyone who made big bets on a “remain” vote, it was a textbook example of how capital markets function. Specifically, markets “price in” available information and are very good at handicapping the probabilities of outcomes. But the stock market can’t predict the future and binary outcomes like this one cause an immediate reaction. Early in the week, stocks were rising in anticipation of a stay vote and quickly adjusted when the result came in otherwise. Friday was a big down day, but for the week domestic and foreign stocks only declined a couple percent. To us, that verifies our view that the decision by the UK matters, but shouldn’t overly concern US based long-term, diversified investors. The formal process for the UK to leave the EU will take at least a few years, and there is no way to know at this point how much friction or economic loss it will cause for Britain, Europe or the world. Estimates from the IMF suggest a 1% to 4% annual GDP loss for the UK over the next several years. Volatility will more than likely remain heightened in the coming days, but we don’t believe long-term investors should be reactionary. These are often the worst times to make drastic portfolio changes. UK stocks themselves make up just about 6% of the global market. We don’t see it causing meaningful systemic risk to the global economy or deciding the fate of the US stock market in the coming months or years. Bonds rose in the US and most major developed countries, once again demonstrating the benefits of multi-asset class portfolios. Have you run an Investment Checkup to see if your asset allocation is appropriate? A long-term global multi-asset class allocation can help you weather the storm of volatile market events. [Run an Investment Checkup now]. Regards, The Personal Capital Team What's Your Asset Allocation? Make sure that your investments are diversified in a global, multi-asset class portfolio. [Run Checkup] $239 Billion Tracked On Our Free Tools & Growing Over 1 million users are tracking $239 billion of America's balance sheet on Personal Capital's free financial tools. Hitting $239 billion was a huge endorsement of our software, its security, and the value it provides our users across the country. [Personal Capital] Personal Capital is the smart way for you to understand, manage and grow your net worth. [Facebook] [Twitter] [LinkedIn] Silicon Valley 1 Circle Star Way, Suite 189 San Carlos, CA 94070 San Francisco 500 Howard Street Suite 400 San Francisco, California 94105 Denver 999 18th Street, Suite 800s Denver, Colorado 80202 Too much email? [Change your preferences] or [unsubscribe]