The U.K.'s opposition Labour Party may secure victory in next year's general election, according to some polls – yet investors are not properly pricing in the risk that might pose to U.K. investments, according to analysts.
"Although polls suggest a Labour victory, I don't think investors are expecting a change of government and what that would mean," Tina Fordham, chief global political analyst at Citi, told CNBC.
"UK political risks are underpriced."
On Monday, a poll by Populus suggested a 6 percent lead for Labour, with 37 percent of respondents saying they would vote for the party, ahead of 31 percent for the Conservatives (Tories).
The Labour Party has traditionally been viewed as less business-friendly than the Tories, their main rivals for power for most of the last century. That changed during the regimes of Tony Blair and Gordon Brown between 1997-2010, when the party moved closer to the City and business interests. Since then, new leader Ed Miliband has taken the party further back to the left, and hasn't courted the City in the same way.