2016 will be remembered as a year of political unrest. In the face of Brexit and Trump, where is the best place to invest in 2017? All investors want the highest possible return on their investment. The best advice you can receive is to invest in something that has a proven track record. Investing always brings a risk so seek out the most reliable you can.
You could argue that stock investment is likely to grow higher over time than the value of your home. Stocks return an average of around 9-10% a year, while homes only return around 3%. However, it is undoubtedly a smart investment overall as it carries less risk.
This is because, the money you would have been spending on rent, is now a form of saving. You will also gain on your investment as the value of your property grows. If you put $50,000 down on a £250,000 home for example, and its value grows to $275,000, you have a gain of $25,000, 50% of your initial investment.
The current bull market is the second longest in history. This does not necessarily mean stocks will fall, but we will see a correction. The solution is not to avoid stocks altogether. You could buy an index fund that invests in dividend growth stocks as these fare better during recessions.
US stocks are the key at the moment, as they are consistently outperforming competitors. Stocks that thrive when the economy is improving, including financials and tech, are a good investment for 2017.
Invest in banks
Financial stocks have been benefitting from Trump’s presidency so far, in particular Bank of Ameria and JPMorgan Chase. Trump’s pledge to cut some of the regulations on banks will certainly make business easier. If Trump’s tax cuts and infrastructure spending truly create more jobs and higher wages, the banks could have more lending demand. The Bank of America is particularly good for buying individual stock.
Buy high-dividend stocks on sale
The real estate market underperformed in 2016. Now is the time to buy stock while they are on sale, as REITs can be some of the best for a long-term investment. One REIT you could invest in is Reality Outcome. Reality Outcome invests in freestanding retail properties, often occupied by businesses that fare well in recessions.
If you want to be daring
The Telegraph published an article early this year, suggesting contrary investment ideas. They do warn that these investments hold considerable risks, so only invest if you have money to lose. One suggestion they give is to invest in is US renewable energy. There are fears that Trump’s policies will be damaging to renewable energy. However, Robert Corminotto contested that renewable energy in the US has three drivers: “state level renewable targets, corporate renewable targets, and federal tax credits.”
He believes only the third could be affected by new policies. The Telegraph gives two options for investing; the First Trust NASDAQ Clean Edge Green Energy, which is more than 90pc invested in the US, or the iShares Global Clean Energy ETF, which is 26pc invested in the US.
Be aware that the best things to invest in change monthly. This means you should consult with an investment management service in Esher to ensure that you are making the best decision you can.
There you have it – five things that you can consider investing your money in this year. Whether you are new to investing or you’re a seasoned professional, take time when considering new opportunities – and never invest in a risky scheme if you’re not confident you’ll see a return.