CFA members say Brexit impact will be ongoing

Added 2nd August 2016

The CFA Institute has a said a survey of its members revealed significant concern that Brexit will have ongoing consequences for investors.

CFA members say Brexit impact will be ongoing

More than 2,000 investment professionals participated in the survey, with 50% of respondents based in the EMEA region. The purpose was to understand global investors’ views on the likely impact of the vote to leave the EU, the CFA Institute said.

UK ‘fragmentation’ with Scotland separating was seen as a major concern by investment professionals according to the survey, with 59% of respondents regarding it as more likely than not.

Other countries exiting the EU was also thought to be likely by 48% of respondents, though ‘wholesale EU disintegration’ was seen as unlikely. NATO disintegration was regarded as being the least likely outcome.

Most respondents expect the uncertainty following the referendum vote to last for up to six months (33%) or for between six and 12 months (25%), and a further 26% believe that the uncertainty may persist for up to two years.

Half of respondents said they expect firms from their own local market to reduce their presence in the UK. Just 5% indicated that they thought firms from their local market might increase their presence in the UK.  

In terms of the relative attractiveness of international financial centres, Frankfurt and Dublin are thought most likely to emerge as ‘winners’ from Brexit, with 69% and 62% of respondents picking them as likely beneficiaries.

Most expect little change in the status of financial centres outside the EU. Some 82% of respondents expect London to be a loser as a consequence of Brexit. 

“In the immediate aftermath of the Brexit referendum vote, we can see considerable variance over how long investment professionals expect market uncertainty to last, but that uncertainty will be with us for a while at least,” said Paul Smith, president and chief executive of CFA Institute. “In addition, while changes in the relative attractiveness of one financial centre over another will see some lose ground and others gain, those changes can be disruptive for  clients and for investment management businesses,” Smith added. “As the consequences of Brexit continue to unfold and evolve, the role of our organisation is to help our members and CFA exam candidates understand what these changes mean at a global, regional and local market level, prepare for them, and contribute to an investment management industry which protects clients' interests and puts investors first."   

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Alex Sebastian

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Alex joined Portfolio Adviser in April 2014 and has been a financial journalist since 2008. He has previously held editorial positions at the Financial Times Group and Euromoney Institutional Investor. Alex is NCTJ qualified and has a degree in economics from the University of Sussex.



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