Uncertainty Is the New Normal After U.K.'s Startling Vote

When investors see a market-moving event coming -- be it a merger, an election or an FDA approval -- many turn to the options market to hedge their bets leading up to the event, increasing the cost of insurance, and once the event happens volatility reverts back to normal. Britons' vote last week to leave the EU may not follow that pattern, if uncertainty remains high even after the event.

There certainly are big questions after Thursday's vote and the prime minister's subsequent resignation. Who will be the next British prime minister? Will this prime minister invoke Article 50 of the Lisbon Treaty to begin the process of leaving the EU? Could any stumbling blocks emerge along the way -- public opinion turning against that move, a call for a second referendum, snap elections? Until some of these questions are answered, market volatility is unlikely to go back to normal.