“Do you, as professional investors, have a view on the ‘Brexit’ referendum?” In recent months, it is a line we have been hearing with ever greater frequency, here on The Value Perspective – though not, we fondly imagine, from any regular visitors to the site. They, we like to think, already know the answer to that question, which is … the only view we have on the ‘Brexit’ referendum, is we have no view.
Regular visitors might know this, for example, because they read our article Polls apart a little more than a year ago. Having raised the possibility that people might already be “feeling jaded by the constant procession of so-called experts speculating on who will and will not win the upcoming general election”, it asserted: “You might as well ignore anything any pundit has to say on the outcome.”
Or else they might know this because they read our article Poll fault a little less than a year ago. Here, with barely a hint of a gloat, we observed: “We may have got our pre-election anti-forecast right but that does not mean we will be getting cocky. We are well aware that, just as we ourselves did not know how the election would turn out last week, we cannot know what will happen next week.”
The confidence with which we expressed our view that, on matters such as forecasting election results, we should have no view had twin foundations – our well-documented suspicion of forecasts and those who earn a living from making them and our even more frequently expressed faith in value investing and its long-run ability, among other things, to turn bad headlines into good investments.
“By focusing on the long term, we avoid buying into any prevailing opinions or other ‘noise’ that could influence portfolio decisions,” is how we concluded Poll fault – and may as well do so again here. “We are mindful of their possible impact but can point to more than 100 years of history that shows an unemotional, valuation-based approach to investing should deliver over the long run – regardless of anything economic, political or any other forecasters might have to say.”