Now is the time to lock in post-Brexit gains say advisors

Oliver Gill
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The surge in share prices after the EU referendum has been labelled the "Brexit Bounce" (Source: Getty)

Financial advisors are urging pension clients to lock-in post-Brexit share price gains before the market tails off later in the year.

According to research by Metlife nearly one in three advisors said that they plan to contact clients about protecting savings and two-thirds have offered clients a review of their finances in the wake of the EU referendum vote.

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The FTSE 100 has increased by over nine per cent since 23 June. But experts pointed to the fact that there is considerable uncertainty facing Britain's economy, which could have a detrimental effect on share prices.

Six in 10 advisors surveyed said that they are concerned about a significant correction occurring this year.

"Clearly there is real nervousness out there with advisors concerned about potential downturns and braced for market volatility ahead with most expecting a significant correction this year as the picture becomes clearer

"Clients still want and need to invest but many are re-adjusting their attitude to risk. They are focused on guaranteeing and capturing gains while they can, while accepting that uncertainty is here to stay for the foreseeable future," said Simon Massey of Metlife.

The concerns of the advisors were more pressing for those with clients within five years of retirement – 44 per cent of them said that they were recommending crystallising gains.

In addition, the research revealed that clients were also contacting advisors. Fifteen per cent said that they had been contacted by clients about locking in gains from the "Brexit Bounce".

"Those clients nearing retirement are faced with decisions that ultimately will impact the rest of their retired lives. There’s never been a more appropriate opportunity for advisors to consider solutions that offer guarantees and the potential to lock-in current gains," said Massey.

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