The Best and Worst Performers after Brexit

The surprise result of the EU referendum sent shockwaves through the financial markets and created a huge amount of volatility. You would normally expect a diversified fund to be relatively immune to this sort of turbulence, but there have been some huge price swings with double digit gains and losses in some of the most affected sectors. Investors will need to be at the top of their game over the next few months as the picture starts to clarify.

Hargreaves Lansdown published a list of the best and worst performing funds in the first week after the referendum and it makes for interesting reading. The main beneficiaries were funds that invest in gold producers such as WAY Charteris Gold Portfolio, BlackRock Gold and General and Junior Gold, with gains in excess of 18%. This was due to the increase in the USD/GBP exchange rate – which also helped many global funds − and the rise in the price of gold.

The biggest casualties were UK funds with a large exposure to the domestic economy such as Threadneedle UK Mid 250, Elite Webb Smaller Companies Income & Growth and CF Miton UK Value Opportunities, with losses in excess of 11%. The latter was especially vulnerable as the management entered a transition period on June 27 ahead of the switch from Georgina Hamilton and George Godber to Andrew Jackson.

Jackson, who had previously run the Ecclesiastical UK Equity Growth fund, will probably look back on it with mixed feelings as the fund fell 12% in June, although most of the decline will be attributed to his predecessors. In their review of the second quarter they said that they didn’t speculate on the outcome of the referendum, but drew up a battle plan for each eventuality….

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