Adrian Lowcock of Willis Owen, a rival firm, warned that currencies could be volatile and might be a bigger determinant of a portfolios performance than the companies it invested in.

If sterling appreciates on news of a Brexit deal, hedged funds will come into play. However, the trading costs in such funds can be higher and eat into any gains, so the currency movement must be large enough to make it worthwhile.

Sam Dickens of IG, the trading firm, said he expected Britain and the EU to hash out a deal before the end of the year. However, Mr Lowcock warned that predicting currency movements was notoriously difficult and that most fund managers avoided making suchcalls.

There are other factors to consider as well. Although Brexit is a big issue at home, it does not have much impact on other currencies.

The American presidential election in November, for example, is likely to be a much larger factor for the dollar.

Mr Dickens added that investors could change their mind on the pound over factors other than Brexit. Recently, the British currency has risen as investors have started to take on more risk, moving away from safe havens such as the dollar and the yen.

If the stock market rally fails to be sustained, the pound could come under pressure again, he said.

Read the original here:

The pound has been volatile when Brexit is at the fore, is now the time to 'hedge' your investments? - Telegraph.co.uk