This wasn't supposed to be a shock.
The polls were fairly close.
The bookies (a much more reliable predictor than talking head economists) put the chances of Brexit at 24%.
Some even predicted it.
And then it actually happened. And the world freaked out.
Think about that for a moment. Twenty-four percent.
This is the equivalent of a .240 hitter in baseball stepping up to the plate, hitting a single and causing the other team to throw their mitts in the air and run from the field screaming "Holy crap! Holy crap! What just happened!"
Because despite the lip service to the possibility of Brexit, it was unanticipated. Rationally people knew it could happen, but that is not the same thing as being emotionally prepared.
In the aftermath (many) investors and advisors find themselves scrambling and asking the question: "What should I do?"
Of course the best time to answer that question was before the fire alarm went off, not during the mad rush to escape the building.
This points to the value of the Investing Crisis Plan, an investing protocol to be formulated when the client is able to make rational decisions to be deployed at a time when they cannot.
MarketPsych has developed a guide and template for formulation an Investing Crisis Plan, available to MarketPsych Insights members (our new advisor client management platform).
As always these shake ups present wonderful investing opportunities for those emotionally and strategically prepared for them.
We do not yet know the implications of Brexit for the investing community (though there is no shortage of opinions on the matter).
It was only a .240 hitter, knocking a ball through the infield. It's not like Bartolo Colon hit a home run or anything.
Happy investing and as always, hey… let's be careful out there.
Frank Murtha, Ph.D.