Just hours before MPs vote on Theresa May's new Brexit deal, interactive investor reveals what investors think and how it has impacted their trading strategies.
Whilst MPs are expected to vote on Theresa May's Brexit deal today, the next steps are still far from clear.
New research from leading flat-fee investment platform interactive investor suggests that many investors have grown tired of waiting for clarity from MPs and are instead pursuing a 'Keep Calm and Carry On' approach.
The latest research was conducted between 4 and 6 March* and shows a significant fall in the number of investors putting investment decisions on ice.
In December 2018, 38% of investors told us they were holding off investing until a firm decision had been made on Brexit, dropping to 31% in January 2019 and then 25% in March 2019.
'5 April means 5 April!'
Whether we end up with a ‘Brextension', a ‘soft Brexit', a ‘hard Brexit', or no Brexit at all, investors are gaining in confidence when it comes to their investment strategies. In December, 39% of respondents said they had a strategy in place and were sticking to it. That increased to 44% in January and again in March to more than half (53%).
Investors are also feeling more inclined to take the investment implications of Brexit and other macro drivers, like US interest rates and the US-China trade war, with a pinch of salt.
In December, 22% of investors said 'it's all noise and I'm not concerned long term', rising to 26% in January and 32% in March.
Moira O'Neill, Head of Personal Finance, interactive investor says: "We've all heard the 'Brexit means Brexit' mantra (although less so recently, funnily enough). But this research suggests that investors are increasingly realising that the ISA deadline waits for no one - 5 April means 5 April!
"Whilst it is good to see so many investors putting Brexit issues to one side, one in four are still saying they won't invest until we have a firm decision on Brexit, and it is concerning that so many people's personal finances have been put on hold.
"Whilst the country may be in a state of political gridlock, it doesn't mean your personal finances have to be, and nervous investors may want to think about spreading their risk with funds that diversify your investment around the world."
Lee Wild, Head of Equity Strategy, interactive investor, says: "Investors have become increasingly less concerned about Brexit over the past few months, deciding instead to ignore the noise and have confidence in their own investment strategies.
"That no-deal Brexit has become less likely may also have emboldened investors. Domestic stocks will do well in the event of a Soft Brexit or no Brexit at all, and the UK-focused mid-cap index has easily outperformed the FTSE 100 this year.
"Brexit is the chief worry among investors, but there's been a big increase in the number of investors dismissing some major global threats as noise. US interest rate policy and Italy's colossal debt pile are largely ignored by investors, and fewer than ever worry about the US-China trade war.
"Investors have grown impatient too. Brexit has dragged on for too long and putting off investment decisions means cash sitting idle in low-paying savings accounts. There's no harm in keeping some powder dry, but investors understand that cash must be put to work eventually."
Ahead of the 29 March deadline, Lee has also compiled his thoughts and recommendations around Brexit and what investors can expect to face as the UK enters the final countdown to potentially leaving the European Union.
He adds: "A no-deal Brexit would be the worst possible outcome for investors in the short term, but it remains possible that Brexit could ultimately be delayed or not even happen at all. Brexit has given investors the opportunity to buy good companies relatively cheaply but, as always, it is vital that investors look to diversify their portfolio to protect against the unknown."
489 interactive investor website visitors completed the poll between 6-11 December 2018.
530 interactive investor website visitors completed the poll between 22-24 January 2019.
399 interactive investor website visitors completed the poll between 4-6 March 2019.
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