Brexit: Hedging Risks Ahead of the Referendum

The video discusses market volatility, focusing on historical events like the Scottish referendum and financial crisis. It explores macro investment frameworks, particularly in the context of Brexit, highlighting the need for hedging strategies. The discussion includes portfolio construction strategies to manage risk and protect against potential Brexit impacts. Finally, it identifies market opportunities and upside potential in a less risky portfolio, focusing on euro stocks and the Nikkei.

What historical events are mentioned as examples of market volatility?

• The oil crisis and the Asian financial crisis

• The dot-com bubble and the housing market crash

• The Brexit vote and the US elections

• The Scottish referendum and the financial crisis

In the context of Brexit, what is a suggested strategy for managing portfolio risk?

• Increase leveraged exposure

• Reduce portfolio risk and increase cash levels

• Focus solely on domestic markets

• Invest heavily in technology stocks

Which market is highlighted as a key area for hedging against Brexit uncertainty?

• The real estate market

• The commodities market

• The FX market

• The bond market

What is a potential opportunity if the Brexit vote results in a decision to remain?

• Focusing on euro stocks and Japanese equities

• Investing in US treasury bonds

• Shorting the pound sterling

• Buying gold and silver

Which assets are considered to have underperformed and are targeted for upside potential?

• Technology stocks

• Cyclical and risky assets

• Government bonds

• Real estate investments