Why the FTSE 250 drop isn’t as bad as it looks

In response to there being a leave vote in the EU referendum, the press where extremely quick to jump in both feet first with the downturn of the FTSE 250 which many are reporting has had the worst drop seen in recent memory. Sadly, they are correct about this and on the face of it it looks extremely worrying as to how it has dropped. Having said that not all is as it seems. If we take a look at the figures four months ago, the FTSE 250 on the 11th February was at a level of 15,178. On the 24th June 2016, it closed at 16,088. Technically the press have been right in saying that the drop has been the biggest, but they have failed to mention the fact that it has been even lower than this. To not mention this is deceitful and all it causes it economic unrest and panic.

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There has been a drop in the value of shares also which will recover in the fullness of time. This should happen fairly soon since the USA, Canada and Germany are extremely willing to set up new trade deals after the Brexit vote. When you tie in the fact that the FTSE 250 actually crept up slightly during the course of the 24th June, the recovery is well under way. There can be no second guessing on how the country will be affected by this economically, but scaremongering such as this is not acceptable.

The pound has also seen a bounce back compared to the USD, again in line with how it was back in February and March this year. If this is the economic instability we have been warned about then it’s extremely anticlimactic.

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