Bringing you live news and features since 2006 

eValue makes radical changes to asset allocation post-Brexit


Immediately following the referendum result, eValue has run its state of the art economic scenario generator, Insight, to take account of the impact Brexit is having on financial markets.

Based on the forecast returns of the model, eValue has reviewed all its risk rated asset allocations in response to the significant impact Brexit has had on the relative attractiveness of major UK asset classes – equities, bonds and commercial property.
Prospective returns on UK commercial property have been a casualty of Brexit. Commercial property valuations take time to adjust but the Insight model forecasts that they are likely to be negatively affected by the predicted slowdown in the UK economy. Accordingly, allocations to commercial property are significantly reduced.
eValue routinely updates its asset allocations each quarter but will be issuing an “out of schedule” investment commentary for clients and IFA users on Tuesday June 28th 2016. The previously scheduled 1st July update will be accelerated to be available for implementation in the first week of July based on 1st July market conditions when the initial shock waves have started to dissipate and longer term market expectations are clearer.
Bruce Moss, Strategy Director of eValue, says: “Based on the impact Brexit has had on financial markets, in the immediate aftermath of the referendum advisers should be making changes to their strategic asset allocation benchmarks. However, the reallocation of client investments to new benchmarks should be made progressively over time to minimise costs and risk.
“Because investors have a preference for assets in their home country, our asset allocations have had constraints on the amounts that can be invested in overseas markets. As a result of the negative effect the vote to leave the EU has had on prospective UK asset returns, we are relaxing these constraints, so that investors following our risk rated asset allocations can benefit from the potentially higher returns in overseas markets – particularly developed country equity markets such as the US.”

Latest News

As the ETF industry reaches a milestone of USD12.71 trillion in global assets, Brown Brothers Harriman writes that its 2024..
Matteo Greco, Research Analyst at Fineqia International writes that bitcoin closed last week at approximately USD66,300, marking a 7.8 per..
HSBC Asset Management’s (HSBC AM) ETF and Indexing business has passed USD100 billion in assets under management (AUM), reflecting its..
Amundi’s ETF Market Flows Analysis for April reveals that investors added EUR54.1 billion to global ETFs in April with equities..

Related Articles

Dan Miller, IQ-EQ
With just over a week to go till T+1 settlement begins in North America, Canada and Mexico, time is of...
Emily Spurling, Nasdaq
Last October’s ETF Express US Awards 2023 found Nasdaq winning Best Index Provider – ESG ETFs and Best Index Provider...
Vinit Srivistava, MerQube
Index provider, MerQube, launched in 2019, with the aim of providing a “technology-driven answer to the most complex, rules-based investment...
Sean O' Hara
Pacer ETFs has announced the launch of three Cash Cows UCITS ETFs. The firm writes that this will give European...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by