Gold
The price of gold usually rises in times of economic crisis because bullion is seen as a safe-haven asset.
Gold dipped as low as $1,255 in the lead-up to the EU referendum, when a remain win was widely predicted. In the aftermath of the leave vote it has risen nearly six per cent in dollar terms to $1,329 as of noon on Monday.
That spells good news for gold miners, who suddenly find that every ounce they produce is worth more.
Shares in Randgold Resources has risen more than 24% from £64.38 the night before the poll to £79.80 on Monday afternoon. Fellow gold miner Fresnillo is up 21% over the same period to £15.
Any company that earns more money in dollars – or euros for that matter – than it does in pounds, stands to gain.
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This means that huge global multinational companies such as Unilever and Reckitt Benckiser are relatively protected from the turmoil. The two firms have seen stock market rises of 4.5% and 3% respectively since Thursday’s close.
Drinks companies also stand to gain, with the likes of Diageo selling huge volumes of Scotch and Guinness to overseas buyers. It has gained 5% since the vote.
Pharmaceuticals companies are among the biggest dollar earners and this is reflected in their share prices. GlaxoSmithKline has risen 5% since Thursday’s close, while AstraZeneca has climbed nearly 7%.
Pharmaceuticals are also doing well because they are seen as defensive stocks, places to put your money in times of turmoil. The economy may suffer, but people will still spend money on medicine.
The same is true of tobacco and there have been rises for British American Tobacco, up more than 4%, and Imperial Brands, 3.5% higher. They also earn a large proportion of their earnings in dollars.
Utility companies, also seen as defensive stocks, were also in demand, with National Grid 2% higher and United Utilities 1.5% higher.
Exporters and luxury brands
Much like the multinational dollar earners, smaller UK firms that rely on exports should benefit in the short-term. The weakness of the pound makes it far cheaper for other countries to buy British goods.
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In the luxury market, this helps the likes of Mulberry, as the falling pound makes posh handbags cheaper for foreign fashionistas in the near future. The upmarket brand initially watched its shares fall after the vote but recovered 3.5% on Monday against a falling market.
Private firms with an export-heavy order book should also do well, although this will nit become evident until they publish financial results over the next few years. Brompton Bicyles, which earns 80% of its money overseas, is one such firm.
However, Prof Nigel Driffield of Warwick Business School points out that exporters may find the benefit of the weak pound cancelled out in the longer term.
“Some argue that with the likely devaluation of sterling following Brexit, small UK exporters may be better able to export, not just to the EU but to the rest of the world.
“This, however, depends on whether the devaluation also increases their costs, given that 50% of the UK’s exports rely on imported components.”
Foreign oligarchs
Eurozone buyers have gained a €50,900 discount on the average London house pricefollowing the EU referendum result, according to analysis from London estate agents Stirling Ackroyd. Dollars buyers will find UK property much cheaper so the capital’s homes are looking like an even better bet for wealthy people from overseas looking to stash their cash in property.
Bernie Morris, president of UK, Europe and Middle East for Chinese property website Juwai.com, said: “Developers and estate agents ... point to Brexit as an opportunity for offshore buyers to snap up properties at bargain prices.
“If the fall in the pound persists and if local buyers continue to sit on their hands to some degree, that will create a more appealing environment for international investors.
“Based on the trend so far this month, we expect consumer inquiries on UK property to be 29.8% higher in June than they were in May.”
Hedge fund gamblers
In the short-term at least, anyone who made a multimillion pound bet on Brexit has done very well indeed. Crispin Odey, a leave supporter and hedge fund guru, took big bets that the value of UK companies and sterling would fall on the back of a vote to leave the EU.
“I think I may be the winner,” he said after apparently raking in a cool £220m thanks to Brexit.
Several major hedge funds, including Odey’s, were known to be backing Brexitbefore the vote.
Overseas investment funds
Investment trusts that help UK investors put their money into foreign assets have done well, as people shift their cash away from assets exposed to the British economy.
JP Morgan’s emerging markets, Asian and Chinese investment trusts were all on the rise on Monday, while its US small company fund performed best, up by 3.7%. There were also rises for funds such as the Templeton Emerging Markets investment trust and Middlefield Canadian Income.
Tourist hotspots
With the pound lower, the UK instantly becomes a more desirable destination for tourists who traditionally find it expensive.
That could spell short-term benefits for B&B owners, hoteliers and restaurateurs in tourist hot-spots.
However, a weaker British economy could depress domestic tourism at the same time.
Stock investors aren’t exactly banking on an uplift for the major listed hoteliers, with IHG, Premier Inn owner Whitbread and Restaurant Group all trading lower.
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