Eurovision final in Tel Aviv
The Eurovision Song Contest, the world’s biggest music show, will take place on 18 May, with entrants from 42 countries battling it out to take home this year’s crown.
The competition, the 64th Eurovision contest, will take place in Tel Aviv, Israel. Tradition dictates that the previous year’s winner hosts the competition, but the financial cost is so huge that several countries who’ve previously won, including France, Luxembourg and the Netherlands, have asked to opt out.1
The first Eurovision song contest was held on 24 May 1956, with contestants from seven countries backed by a live orchestra. It’s only in the last 20 years that entries have used a recorded backing track.
Back in the 1950s, every participating country could enter with two songs. Since then, more than 1,500 songs have been sung and the competition has become a massive industry. While viewing figures tend to fluctuate, in 2016, some 204 million people saw at least one of the three live shows, with viewers from across five continents tuning in to watch the final.2
Brexit and Eurovision
Despite ongoing political and economic uncertainty as Britain continues to negotiate its departure from the European Union, possibly the only thing there is any clarity on is that Brexit won’t have any impact on the UK’s involvement in Eurovision.
The event is not linked to EU membership, and any country with a broadcaster which is a member of the European Broadcasting Union (EBU), which the BBC is, is eligible to enter. Russia, Israel and Australia all have channels which are members of the EBU, which is why they can participate.
The UK has won Eurovision five times, most recently in 1997, although in recent years its performance has been somewhat lacklustre, to say the least. This year, Michael Rice, 21, from Hartlepool will be flying the flag for the UK, having won the public vote on the BBC’s ‘Eurovision: You decide’ singing show.3
Picking the winner
As with any competition, the winner of the Eurovision Song Contest is impossible to predict. Whilst neighbouring countries often vote for each other, no-one knows until the night which nation will claim victory.
It’s a similar story with investments, as however much research you do, there are never any guarantees that those you’ve chosen will perform well. Even if an investment does prove a winner for a certain period, it could fall in value without warning, leaving investors with less than they put in.
That’s why diversification is so crucial, helping investors to diminish risk by spreading their money across a wide range of assets, sectors and geographical areas. This means if any one country, asset or company suffers a period of underperformance, hopefully gains from others will help minimise the impact.
The outlook for Europe remains dominated by the potential arrangement the UK manages to broker with the EU, if any, and the consequences of this agreement, on economic growth.
Therefore, as well as ensuring portfolios are properly diversified, investors should take a long-term view, as committing to investments for typically at least five years but preferably much more can potentially reduce the risk, that they will need to sell when prices are low.
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