Etoro

How eToro users survived brexit and made a profit of 2.4%

<p style="font-family: gill sans;">Perhaps the most substantial financial event of the decade, the Brexit vote created a lot of turmoil in global markets, but was also an opportunity, which eToro clients used to make a profit</p>

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It’s been a few months since the Brexit vote, in which the citizens of the UK elected to part-ways with the European Union, yet its effects on the global economy are still very much apparent. Following the vote, the British Pound crashed 9% and literally trillions of dollars were wiped off the global stock market. However, investors on social trading platform eToro seemed to come prepared, with an average return of 2.4% on the day of the Brexit.

Many finance experts believe that the reason for the catastrophic losses suffered in global markets on the day of the Brexit is that a lot of investors simply didn’t believe that the British people would vote “yes.” After the results were in, and people understood the consequences of the vote, leading to a whole new reality in the European market, many investors lost faith in the British currency and withdrew funds from British assets.

On eToro, traders that were surveyed regarding the Brexit vote actually had a pretty good idea. 52% of traders said that they are expecting a “yes” vote, which made them prepare and react accordingly. Therefore, while shorting the British Pound was a gamble that paid off for those who made it, the majority of eToro users prepared otherwise, using lower-risk tactics.

Better safe than sorry

An apparent trend ahead of the vote was investing in safe-haven assets, such as precious metals, which are usually perceived as an alluring alternative to currencies when the market shows high volatility.

Alongside withdrawing funds from the GBP, UK-based stocks and the FTSE index, another approach that was seen in foreign exchange investors was buying U.S.

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