Saturday, January 10, 2015

Crucial Investment Strategies To Explore In 2015



Whether it be the slumbering gold worth or the staggering stock market, 2014 brought with itself a tremendous financial misfortune that affected people from all walks and spheres of life. However; with a new sun bringing forth hope and optimism in 2015, financial gurus are foreseeing some betterment in condition and are thus plating out the possible arenas to explore in the year. A detailed study of the market trends and a series of fortunate financial events taking place across the world weaving themselves in the string of destiny, have some interesting patterns to reveal, which when unveiled will probably deliver the economic world some respite. Hence; if you are looking forward to plan the year ahead on a beneficial or profitable note, you would definitely not want to miss out on some hot investment opportunities that can really alter the facet of your portfolio for the year ahead.

Giving the stock market a thought

Although the figures at the stock market really failed to impress and investors witnessed some serious casualties, the last quarter of the season set the road ahead for some glimmering hope. Experts suggest holding stocks and bonds in the ratio of 50-50% for elderly people who are moving into their retirement stage. However; US stocks being still the best performing assets, are suggested to be in hold of a young person, in as much quantity as 80%, as risks are seemingly far less for the youngsters. With small cap funds outperforming their expected returns, finance gurus are really stressing it on the small caps. A simple equation that puts it forward is that despite the stagnation in the growth of leading companies in world, it is the small or developing companies which are dishing out profits and now is the right time to reel in the returns. Flaunting a handsome growth rate of 20.28% as compared to the daunting -3.3% rate of the Fidelity Select Retailing Portfolio, small cap investment surely is seemingly going to rope in more trust than any other types of stocks. Market analysts and gurus like Ronald Temple, the portfolio manager and managing director with Lazzard Asset Management, has a say to better stay off from the bonds of the developed countries, due to a single reason that his perceptions about the risk and reward ratio of these bonds is veryassymetric. Hence; if you want to patch up the holes and scratches from the last financial year, investing in small caps stocks can be a better and undoubtedly a safer option.

Viewing the world stage

Other than keeping an eye on the small caps, experts are really stressing it hard on the stocks of the emerging markets, like the MSCI Europe Stock. According to Taylor Gang, the principal of a Financial Wealth Management company, these stocks are pretty unpopular among investors and being comparatively cheaper, these provide a lot of scope for higher profits. Other than Europe, it is also advisable to pay a heed to the growing of growing economies like China and India, where things despite being still residing in the grips of recession, are hopeful. The most important and useful factor about the stocks of these emerging economies is that the stocks of these countries are still the cheapest and their  return rates are expected to meet high levels. For instance, India has been a country that is still struggling with recession and political debates. However; with the implementation of several measures by the Reserve Bank of India, India has been able to combat the recession pretty well. While it was soaring somewhere around 11% during the initial days of the last year, the heat has died down a little and growth rate of the country's economy is expected to rise from 5.6%, as it was in the last year to a whooping 6.4% in 2015. The fact that the developing or emerging markets are also stressing on and are implementing quantitative easing to make things look better on their front is also a factor to rejoice about. A combined power of multiple positive factors make these stocks a better bet this year.


Stick to US Dollar

While the world economy is still struggling with recession and the economic sector has witnessed a steep downfall in the value of currencies of several major developed economies, the U.S Dollar has been successful in garnering better values with a recorded U.S Dollar Index (DXY) of -0.15% in January 2015. This successful rendering of the rates last year has helped the U.S Dollar retain its sheen in the eyes of the investors, especially those who deal in currency trading and betting on U.S stocks which bet on the change in value of the U.S Dollar, like the U.S. Dollar Index Bullish Fund, which recorded a decent 9% return in 2014 and is only expected to perform better in the year ahead. With the US dollar being slowly transitioning into the overbought condition, market trends are reflecting that the upscale of the US Dollar value is seemingly the highest in the last 5-7 years and with the growth projections exceeding expectations, returns are seemingly going to unfold way sooner than when it has been forecast. With the statistics reflecting a positive journey for the US dollar in 2015 and the subsequent years to come, expert suggestions to stick to the US Dollar to create a safe play zone in the year to come cannot be denied.

Move from bonds to stocks

Bonds have always been the most preferred and trusted wagons for investors who plan on long term investments and are up for secure gains. However; with moves being implemented by various organizations, stocks are expected to garner higher fan following this season than bonds. Equity investment in 2015 is surely going to be a hot investment strategy, as stocks are expected to bring in higher profit rates than bonds, and bonds which have been a major source of emergency investment backup for most investors, will be witnessing a major downfall in their return rates. With the US stocks seemingly going to exist in the Bullish market for the next 10 months and the yields from the bonds seemingly heading towards a decline, it always becomes more suggestive and meaningful to stick to stocks this year than to find a safe haven with the bonds. Moreover, investing heavily in private equities and stocks is also still the best measure or weapon to fight recession, a phenomenon, that is not going to leave the lands too often. The trick here would be though to rely on long term investments rather than concentrating more on liquidizing the assets too often. This is because, the average payout for the stocks will be comparatively lower than what we witnessed and rejoiced in the past 10 years. However; staying honest with same stock for a longer duration will definitely promise more yield, as bonds are anyways going to enter into a detrimental phase.

MLP investment

Investing in MLP or Master Limited Partnership company stocks is one of the best bets for the year 2015. These assets function and are traded just like stocks and despite the trembling base of oil prices, these companies, which primarily deal in pipelines and gas and oil storage, are definitely going to secure overall good returns. While the steep stooping of oil prices have really offended investors in the year which passed, these companies are expected to secure better results, primarily because these deal in pipelines and engage themselves in long term contracts for transporting oil. It is believed that it is because of the operation styles of these companies that the dividend rates of these companies will witness tremendous growth in the future and the results are also believed to be not to far settled. With returns promising a range of as high as 7%, investing in MLPs are in no way a forced asset investment decision today, especially in a time where even the best performing stocks of the past 10 years failed to perform and even stand up to their expected rates. While it's true that MLP investment can be one of the most important investment strategies to take for the year, choosing the right stocks while being in the hunt for good MLP stocks, is also equally crucial. Hence; if you are really hunting it hard, you can definitely take a look at the midstream MLP stocks. While the fact that midstream MLP stocks are not completely safe from the factor of abrupt price change and price drop, these stocks surely are immune from the factor of volatility. Being fee based, these stocks are blessed with minimal direct commodity risk, which in turn ensures secure results and returns for the investors. The fact that the demand for energy resources remains almost always steady, these energy stocks run minimal risk of going down the drain.

Experts are suggesting to capitalize more on the oil and gas transportation stocks rather than on gas gathering stocks, since the transportation stocks are estimated to constitute for as much as 60% of the capital spending. However; other than that, experts are suggesting to keep an eye on rail transportation as well.  


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