This week’s fairly high risk move back into sterling and stock markets would appear to suggest markets are confident of the final outcome being a vote for the status quo so to speak, as voting comes to a close at the end of pretty miserable day weather wise.
Wagering large amounts of money when the upside profit is about 20% of your total stake, either means that you are extremely confident of the final outcome, or that you have more money than sense.
In a binary outcome there can only be one result, heads or tails, and given that opinion polls continue to point to an uncertain result, albeit slightly in favour of “Remain”, who can say with that amount of confidence that “Remain” will definitely win.
Let’s face it the accuracy of opinion polls in recent times shows there is always the prospect of what we can now call a “Leicester City” moment.
As it is the FTSE100 has gained nearly 7% in the last 7 days while the pound has rebounded from lows of 1.4010 to peak earlier today at 1.4950, and post its highest levels this year, as the polls continue to improve in favour of “Remain”.
This suggests that a good part of this “Remain” bounce could well be largely priced in already and if we get some early results in the early hours of the morning pointing to a move back to the “Leave” camp then sterling could drop back sharply, potentially dragging stock markets down too.
It looks like we could be in for an interesting night, so it’s time to order in the food and black coffee.
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