Master's Thesis from the year 2017 in the subject Economics - International Economic Relations, grade: 2,0, University of Innsbruck (Banken und Finanzen), language: English, abstract: The unexpected result of the Brexit referendum to withdraw from the EU resulted in high levels of political uncertainty, which affected financial markets adversely. To assess whether the Brexit caused disruptions a structural break test was conducted for stock and forex markets. The results suggest that only British stock markets experienced significant disruptions, which was although only minor relative to other adverse events in the last decade. On forex markets five exchange rate pairs were investigated. All conversion rate pairs, except the EUR-USD pair, showed significant responses. However, again in comparison to other events, the severity of the structural break was relatively petite. In the aftermath of the Brexit, British stock markets developed positive and outperformed many global stock markets, implying a positive reaction to Brexit. In order to rectify for actual developments, it was corrected for exchange rate effects in order to gauge the de facto gains/losses of British and European stock markets. Therefore, the difference-in-differences approach was applied, which indicated that losses for the FTSE 250 ranged between 12-16% and FTSE 100 losses lied between 6-9%. The EuroStoxx 600 evinced a similar range of losses of 5-8%. Based on the increase of country specific risk it is ...