Contrarian Investor: Brexit result is 'populist anger' at work

Questions surround validity of forecasting

Thank God we do not expect investors to be good at guessing the outcome of big political decisions, writes David Stevenson.

The prime example of this supreme skill in forecasting comes from the foreign exchange markets, where the delusion burgeoned to such ludicrous levels that at one point towards the end of referendum day the cable rate shot up to $1.50. The challenges represented by forecasting were very much in evidence in the Brexit campaign. Most investment types I talked to assumed a 'remain' win, even though they may have privately longed for a 'leave' outcome. Alienation Subsequent post-referendum analysis has exposed one overarching explanation for what went wrong: investment types are part of ...