What happened to the BT Investment Management share price?
If you want to get an idea of how much the Brexit vote took the stock markets by surprise, you only need to look at the wealth management and financial stocks that operate in the UK.
Among them, Henderson Group [ASX:HGG] and Clydesdale and Yorkshire Bank [ASX:CYB] both dropped nearly 35% in the week after the vote. BT Investment Management [ASX:BTT] fared much the same, dropping from $10.30 to $7.50 (around 27%) in just three days.
However, over the last week, BT Investment Management’s shares have ground 18% higher.
Why did BT Investment Management do this?
Much of the fear about the exit from the EU is fear of the unknown — nobody knows how and when the exit will take place. For financial services companies, this level of uncertainty was expected to see investors leave the UK market (and financial services companies) in droves.
However, in an update on 12 July, BT announced that funds under management had actually grown from $77.2 billion up to $79.7 billion for the quarter finishing 30 June, 2016. This, and the growing acceptance that life in the UK will go on — whether they are a part of the EU or not — seems to have put a floor under the stock prices for the time being.
What now for BT Investment Management?
However, it’s still very much early days. It will be years before anyone will be able to determine if the exit from the EU was a benefit to the UK and its economy. And that’s presuming the exit will take place. There are still those predicting that the non-binding vote will never find its way through the Parliament.
For the moment, though, investors will continue to watch updates from the wealth managers to determine where the money is flowing. This update from BT was for the period ending just six days after the Brexit vote took place. It will be the next quarterly update, and the one after that, that will see if any trend emerges.