Trump is president. What now?

When a US election provokes the crash of the Government of Canada's immigration website you know something is afoot. ‘America decided the experimental drug was worth risking the side effects', as one political commentator put it.

Evolution has equipped us with a serious distaste for uncertainty. We have a preference for predictable outcomes and this isn't one of them.

On the bright side, simply knowing who the next president will be reduces some of the uncertainty felt in the lead up to the election. Markets may rise on that news alone. On the dark side, who knows what a Trump presidency will mean for the global economy, its markets and foreign relations.

Potential fallout

Plenty of fallout ideas have been thrown around by the analyst team overnight, but the consensus is that Trump's victory won't have a large impact on most Australian businesses – with a few exceptions, which we'll get to.

That said, the future of interest rate policy now looks decidedly more hazy. US Treasury yields have gone up since Trump's win, especially at the long-dated end of the spectrum. The two-year bond is up only slightly but the 30-year bond is up 32 basis points to 2.77%.

The assumption seems to be that the Federal Reserve will hold interest rates low and provide extra stimulus in the short term to counter market uncertainty. But this also echoes Trump's pre-election threat that he would replace Fed chair Janet Yellen when her term ends in 2018 because he thinks interest rates should rise sooner.

Trump's proposed tax cuts should also provide plenty of additional fiscal stimulus, along with his plan to spend more than $500 billion on upgrading the country's infrastructure (and you thought Australia had a federal budget deficit). Trump has also pledged to tear up international trade agreements, including the 12-nation Trans-Pacific Partnership, which includes Australia, as well as the North American Free Trade Agreement. Whether that happens or not we shall see.

Lower taxes, lower interest rates, more government spending and protectionist trade policies have implications for those Australian stocks with US and Asian exposure, including James Hardie, News Corp, Ansell and QBE Insurance. Cochlear, ResMed and CSL all have US exposure too, but it's unlikely any of Trump's proposed policies would have a large impact on healthcare spending and their respective markets.

For the time being we aren't going to make any rash adjustments to any of our price guides. Trump's proposals can't be enacted overnight and will still need support from bigwigs in the Republican party, many of whom were against him in the final days of the campaign. Their level of support now will set limits on what he can actually do, although it's fair to say that Trumps' proposed military withdrawal from east Asia and, potentially, Europe, adds to the geo-political risk.

Embrace uncertainty

Today, many of us woke to a sense of bewilderment and confusion, which suggests it's reasonable to assume that share prices are going to be particularly volatile in the coming weeks. Where does that leave us?

The first thing is to accept that uncertainty is part and parcel of investing. As Warren Buffett said in a 2011 CNBC interview: ‘The world is always uncertain. The world was uncertain on December 6th 1941, we just didn't know it ... The world was uncertain on September 10th 2001, we just didn't know it ... Now the question is, what do you do with your money? … If you leave it in your pocket, it'll become worth less over time. That's certain.'

We will always be making decisions in an environment of unpredictability. What matters is working with the facts as they stand and focusing on the long term. The craziness of yesterday's election result can be turned to your advantage, but only if you can keep your cool and buy high-quality companies at discounts to their intrinsic value.

Finally, in the coming weeks be mindful of information bias – our tendency to believe that the more information we acquire, the better our decision will be, even if the additional information is irrelevant. As Dave Rubin said last night, ‘Media which got everything wrong will now tell you all the things that will happen as a result of the thing they said wouldn't happen'.

If you find it hard to pull the trigger when buying, and justify it with thoughts like ‘I'll give it a little while longer to see what happens', remember it is the uncertainty that delivers the best opportunities. Take a deep breath, and enjoy the hunt!

Disclosure: The author owns shares in Ansell and News Corp.