Investational attractiveness of the the UK securities continues to grow judging by the FTSE indices. Will this trend continue growing after the UK leaves the European Union? World economists provided their forecasts.
First, let’s look at the meaning of FTSE indices and the influence of Brexit on British stocks.
The FTSE indices and their meaning
FTSE 100 is an index that includes 100 leading companies with the most significant capitalization on the British Stock Exchange. This indicator is considered one of the most reliable in Europe because it has been observed by an independent FTSE Group since 1984.
Also, there are FTSE 250 and FTSE 350 indices, which provide information regarding the first 250 and 350 companies respectively. However, they have less influence than FTSE 100.
Corporations become members of the FTSE 100 by the following criteria:
- belong to the British Stock Exchange;
- express the value of shares in euros and pounds sterling;
- relate to a specific state;
- have highly liquid shares in free float.
“Brexit” and Investments: the Experts’ Opinion
According to the statistics, the FTSE 100 index has barely changed from 2000 to 2017, while the FTSE 250 index shows an increase of 20%. Let’s figure out which factors influenced it.
Of course, the decision by the UK to withdraw from the European Union has shattered the stability of the pound, which fell in comparison with the euro. The share price also declined, but then absolutely recovered. According to the expert, the shares of British companies, profitably bought during the crisis, will bring profit to their owners in the future.
According to Andy Broth, the head of one of the divisions of the investment company Schroders, investments in British companies will be no less profitable than before. As for the FTSE 100 index, it indicates a reduction in dividends in recent years.
When it comes to the FTSE 250 index, according to Andy Brot, it is more dynamic. Even if FTSE 100 shows stagnation, still there are changes among the 250 companies. It is essential for investors to react to changes in the rating and make appropriate decisions.
In general, Andy Brot supports Britain’s withdrawal from the European Union. The expert on investments is inclined to the opinion that in the long term the country will unveil unprecedented investment opportunities.
How can you track the dynamics of stock prices?
You can observe the growth and fall of shares on the official site of ETF-monitoring by the link.
You should monitor the dynamics of the stock market if you are planning to make money by investing. And the analysis of the investment attractiveness of UK stocks after the Brexit will become an excellent practice for you. Invest reasonably!