Post-Brexit Trade Deal has been signed, which stocks will benefit?

Brexit

The long-awaited post-Brexit trade deal has been signed by EU heads and was overwhelmingly approved by British MPs.  UK lawmakers backed the agreement on Wednesday afternoon by 521 votes to 73. European Council President Charles Michel and European Commission President Ursula von der Leyen signed on behalf of the European Union on Wednesday morning. It was then flown to London by a Royal Air Force plane where Prime Minister Boris Johnson signed for the UK at 10 Downing Street. The deal has been signed and changes to the current relationship will come into force on January 1.

Investors might be asking themselves which stocks will be benefiting from these trading agreements. Here are some of the investing ideas that might help you play the post-brexit deal:

  • Vanguard FTSE 250 UCITS ETF / Ticker: VMID

This Fund seeks to track the performance of the Index, a widely recognized benchmark of 250 mid-cap sized companies based in the United Kingdom. It’s said that FTSE 250 tracks the UK economy much better than FTSE 100.  UK smaller companies underperformed large ones in the aftermath of the EU referendum, with the FTSE 250 finishing 12.4 percent behind the FTSE 100 index in 2016, so you might expect this to be reversed, to an extent, with a good deal. VMID has around 1.699 Billion GBP under management, and it has gone up more than 20% in the last 6 months.

  • Burberry Group plc / Ticker: BRBY

Burberry is a British luxury fashion house headquartered in London, England. While this FTSE 100 luxury brand and retailer has a significant global presence, Europe is an important market for it as well. With a Brexit deal in place, the threat of any loss of business on lack of regulatory clarity or higher taxes has now dissipated.  BRBY is still down around 17% since the beginning of the year and 2021 can be a good year for the stock.

  • AstraZeneca plc / Ticker : AZN

AstraZeneca plc is a British-Swedish multinational pharmaceutical and biopharmaceutical company with its headquarters in Cambridge, England. Its vaccine has been just approved for use in the UK. If we add approved vaccine news to the latest Brexit news this gives great upside potential for this UK based company. In comparison to Moderna’s and Pfizer’s vaccine, AstraZeneca’s vaccine does not need subzero temperatures for storage and is much easier to distribute worldwide, so if it manages to close deals with different governments worldwide AZN stock might be skyrocketing in 2021.

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