Political events vs markets – not linear

If one had a crystal ball end of 2015 and knew in advance that British would vote for leave in June, Trump would get elected in November and Renzi would resign in December 2016, then he probably would buy gold and sell equity. And unfortunately that person would lose money even with perfect foresight of political events.

However, if he did the same exercise end of 2016 and knew in advance that May would trigger Article 50 end of March and call a snap election in April, the defeat of the anti-euro party in the Dutch election, Erdogan’s win in the Turkish referendum, and Macron’s win in the first round of the French election, would that person sell gold and buy equity? Probably so……and that would have made him decent gains.

At the end of the day, in your opinion, should one trust a crystal ball that predicts political events?


Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s