We are leaving behind this 2016 and now many start to wonder where to invest in 2017. Perhaps you too are among them, because it is generally in the last few days of the year that is talked about how to position yourself for what is coming.
Today we will see the current situation of the markets on the major asset classes and what are the prospects …
Where to invest in the new year?
Currently, the general situation is rather calm and positive and so few see the risks. But I believe there is some situation in the new year on the horizon that could create some problems, especially on specific asset classes.
Notes: The segment most at risk in my opinion is the bond market. With yields that have stopped falling and started to rise and stock prices, as a result, which fell in July of this year there has been a reversal of the trend in this market. This trend may continue in 2017 although we must not take anything for granted (I will write about this subject in the coming days). When in doubt, however, is not the case of being too invested on fixed-rate bonds and long-term. Better to give priority to the variable rate.
Oil: I believe the oil will continue to be a tonic for at least the first part of the year. Accordingly, an investment in oil shares may be a good choice at the sectoral level.
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Gold and precious metals: They are less positive on this asset class. If the will continue to be a strong dollar and rates will rise, gold and precious metals as investments would be avoided.
Stock market: The asset class remains to be favored. As I have written several times in this 2016, even when things were not going very well I always thought that at this time an investor has no real alternatives to the investment share and cannot afford to stay out of it. I continue to think that very even now, and at least for the first half of the year should be continuous at the actions to do well.
Emerging markets: Where to invest in the stock market? Emerging markets are those with the best prospects, given that in recent years have made it much less mature markets and now should return to have the support of raw materials, which have a significant weight on indices. Emerging markets should also record the best profit growth.
Inflation-linked bonds: Returning a time to bond markets, the inflation-linked bonds could be the best choice, given that inflation is at its lowest anywhere in the world and in some countries we have a real deflation. Expectations are for a resumption of growth in prices.
These are the most important investment themes in this moment and it is from here that we must begin to decide where to invest in the next year. Your asset allocation can start from these ideas, but I recommend always remember to invest according to your risk profile, because the psychology is the most important part of your investment process.