Five in­vest­ment ideas for 2014

Business First - - NEWS -

Rapid tech­no­log­i­cal, po­lit­i­cal and so­cial change will re­quire in­vestors to main­tain a more ac­tive watch on their portfolios in 2014 in the chase for in­come, ac­cord­ing to Prescott Se­cu­ri­ties.

“The global winds of change will re­sult in the cre­ation and de­struc­tion of in­dus­try sec­tors and businesses over the next 12 months,” Prescott Se­cu­ri­ties Se­nior Econ­o­mist Alan Hutchin­son said.

“There are too many emerg­ing in­vest­ment op­por­tu­ni­ties for sit­ting on your hands to be an op­tion in 2014. More ac­tive port­fo­lio over­sight and man­age­ment will be needed.

“In most of the ma­jor economies the threat of a fall back into re­ces­sion has passed with the US and many Euro­pean share mar­kets at record highs. Sev­eral qual­ity Aus­tralian stocks are also at his­toric highs al­though the over­all na­tional mar­ket is still well be­low the 2007 peaks.

“Smart stock se­lec­tion is crit­i­cal in the hunt for in­come and long-term wealth gen­er­a­tion.”

Prescott Se­cu­ri­ties Ten Best In­vest­ment Ideas for 2014 are:

1. Em­brace change

“Baby boomers are spend­ing more on travel, hous­ing, tech­nol­ogy and health­care at lev­els pre­vi­ously thought to be ex­ces­sive for re­tirees. In­vestors need to be aware of po­ten­tial in­vest­ment op­por­tu­ni­ties aligned with these de­mo­graphic shifts.”

2. The in­no­va­tors

“In­no­va­tion sep­a­rates the best com­pa­nies from the rest of the field. Com­pa­nies such as CSL pour sig­nif­i­cant re­sources into re­search and de­vel­op­ment. With the growth of the global mid­dle class, their mar­ket is snow­balling and in­no­va­tion is their only com­pet­i­tive ad­van­tage.”

3. New po­lit­i­cal regime

“The elec­tion of a Lib­eral Na­tional Party Coali­tion means a more busi­ness friendly and less fre­netic style of Govern­ment is likely. We also ex­pect in­creased merger and ac­qui­si­tion ac­tiv­ity, par­tic­u­larly in the agri­cul­ture sec­tor as bids emerge from over­seas. One way to tap into this is via man­aged funds that in­vest in the smaller com­pa­nies most likely to be tar­geted.”

4. Tap­ping into China’s grow­ing mid­dle class

“As in­comes in emerg­ing mar­kets im­prove, so does the de­mand for prod­ucts such as wine and fine foods as well as ser­vices in­clud­ing travel, higher ed­u­ca­tion and in­sur­ance. With the pick-up in over­seas travel by Chi­nese na­tion­als, Syd­ney Air­port and Westfield Group stand to ben­e­fit.”

5. In­vest­ing off­shore

“In re­cent years, Aus­tralian in­vestors have been ner­vous about in­vest­ing off­shore. Given the rel­a­tively sub­dued na­tional eco­nomic growth out­look, a higher off­shore ex­po­sure through man­aged funds may be worth con­sid­er­ing. This ap­proach can pro­vide ac­cess to high qual­ity brands such as Ap­ple, Google, Mi­crosoft and John­son and John­son.”

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