The US Election Result : What does that mean for investors in the UK?
This article is for information only and no recommendation is being made or should be construed from the contents of the article. Always seek independent financial advice prior to taking any action.
For some, the victory for Donald Trump in the US presidential election last week was surprising and has created uncertainty and short-term volatility within the financial markets across the world with the dollar initially plummeting.
So what does this mean to investors within the UK? The main advice at the moment would be to sit tight and remember that such short-term fluctuations are inevitable and do not change the fundamental need for people to save long term and invest for their future.
Moreover, as always seems to be the case, once over the initial shock the markets will generally recover. Even with Trump’s anti-trade stance, there are many restrictions on the new president’s power – including a Republican-controlled Congress who is unlikely to agree on any extreme protectionist policies, not least because the Republican Party has always favoured free trade.
To add to this, as the incoming president has to wait 10 weeks until the official Inauguration Day, this should hopefully allow further time for the initial fears to subside.
When looking back to past US elections, a change in president and a political shift has not actually influenced the US economy as a whole. Luckily for him, Trump has inherited a growing US economy that is in recovery from the recent financial crisis. There will be fluctuations and uncertainties ahead but you only need to look at the recent Brexit vote in the UK to see how markets have dealt with and bounced back from similar concerns and volatility.
As an investor, you should concentrate on the long term goals of your investments and not be alarmed by short term events. As professional and experienced Investment managers, Prosperity IFA advisors will make the decisions that can help protect your investments against a range of risks – political or otherwise.
If you do have any questions or concerns on your investments, do call us on 01892 300 303.