Where to invest in 2017?

Following a tumultuous year for markets in 2016, 2017 promises just as much gyration despite a record-breaking start to the year.

The FTSE 100 broke to record highs day after day as the weaker pound drove exporting shares to new highs.

This was a near mirror image of the rally investors enjoyed subsequent to the vote to leave the E.U. In dollar terms, many companies plummeted and overseas firms took advantage of this to swoop in with takeovers of Arm Holdings and Sky.

In dollar terms, many companies plummeted and overseas firms took advantage of this to swoop in with takeovers of Arm Holdings and Sky.

A Year of Takeovers?

Takeovers of London-listed shares may be an ongoing theme for 2017 as mergers and acquisitions drive significant returns for investors in a market where valuations are becoming stretched and equity returns dispersed.

Shares in companies that are subject to takeover attempts can produce extraordinary returns in the short-term. For example,  Sky shares rose over 25% in one day when Rupert Murdoch’s 20th Century Fox announced his plans to buy Sky for £18.5bn.

The media is awash with predictions of the companies likely to be taken over and every broker you speak to will likely help with reports on a selection of potentials.

Emerging Markets

Due to the rich valuations of developed market equities, some analysts are looking to emerging markets for investment in 2017.

Emerging markets traditionally offer chances of higher growth but have higher volatility than developed markets such as the UK and US.

This may deter investors from investing in single emerging shares, thankfully there is an ever-growing range of diversified funds available to investors which offer exposure to companies listed in emerging markets such as China, Latin America, India and Russia.

However, in some circumstances, these funds can be expensive and many companies listed in London, for example, provide direct exposure to overseas companies through their operations.

Such stocks tend to be found in the commodity sector due to the high consumption of natural resources by emerging markets.

Commodities

Oil plummeted in early 2016 only to push higher throughout the year. Some FTSE 100 blue chip oil companies more than doubled from their lows and many analysts are still rating oil stocks as ‘buys’.

This can also be said of mining companies. Copper and Iron Ore staged recoveries in late 2016 and buoyed FTSE 100 miners, a couple of which managed to maintain high dividends despite low metal prices throughout 2015.

As an investor, it is important to explore as many options as possible and gain as much information as you can. Some may choose to do this through self-directed information gathering, some may prefer to speak to an adviser.

Which you category you fall into, we are confident you will find the free reports below useful.

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