….absolutely nothing. Unless you are invested in defensive companies, government bonds and other “risk-off” assets. That is until conflict starts, at which point history teaches us that (strangely) markets rally dramatically as a result.
The war of words between Kim Jong Un & Donald Trump has been a major focus for markets over the past few months, with investors hoping that it doesn’t escalate into a fully-fledged war of nuclear proportions. This month we consider the possible implications for the markets if this tension continues to escalate. We use data from previous wars spanning back to WWI to examine the possible consequences if this verbal war becomes a real conflict. Thankfully we have no benchmark for an exchange of nuclear missiles. We sincerely hope it stays that way.