Markets Divided on No-Deal Brexit

The video tutorial discusses the impact of the Brexit deadline on market conditions, focusing on the weakening of the pound and the unexpected outperformance of domestic stocks compared to the Footsie 100. It explores how the term premium for the pound reflects investor concerns, particularly as the Brexit deadline approaches, and compares current risk pricing to the period before the Brexit referendum.

What unusual trend is observed in the stock market despite the weakening pound?

• Domestic stocks are underperforming.

• Domestic stocks are outperforming.

• Footsie 100 is outperforming.

• Footsie 100 is underperforming.

What is the significance of the Footsie 100 in the context of the pound's performance?

• It is unaffected by the pound's performance.

• It includes big international stocks that do better when the pound is weak.

• It benefits when the pound is strong.

• It represents domestic stocks only.

What does the term premium indicate in the context of currency options?

• The current exchange rate of the pound.

• The historical performance of the pound.

• How options are pricing the pound at different times.

• The interest rate of the pound.

Why is there a jump in the term premium line three months out?

• Investors are selling off their stocks.

• Investors are confident in the market stability.

• Investors want more protection as the Brexit deadline approaches.

• Investors expect a rise in the pound's value.

How does the current term premium compare to the period before the Brexit referendum?

• It shows no risk at all.

• It shows the same level of risk as in 2016.

• It shows more risk than in 2016.

• It shows less risk than in 2016.