The best sectors to look into over the next year for making a small investment to top up your family finances
Thinking of making a small investment to improve your long-term financial security? After a long period of uncertainty, the past 18 months have seen the markets start to stabilize and grow. This is the perfect time to pick up stocks, while costs are still low but when potential is high. These are some of the best sectors to consider over the next year.
Energy
Green energy markets remain a complicated business as government subsidies come and go, but you might be surprised to hear that oil is now starting to look interesting again. The reason? Prices are close to what most experts predict will be their lowest point, but pressure on the industries that depend on them is growing; the stalemate has to end soon, and from there, the only way is up. This is why companies like Cabot Oil & Gas are now attracting serious interest. You probably won’t want to hold onto investments in this sector for more than a decade, but they could be very lucrative within that time.
Credit
As the economy recovers, businesses start to grow again and individuals feel safer about spending, the credit industry is on the rise, and credit card companies are expecting considerable growth. American Express is one example that looks like a good pick, but there are many more. Investing in this sector has the added bonus of helping the economy more generally.
Biotech
If you’re looking for a sector with real long-term potential – something to finance your retirement or a trust fund for your kids – biotech is a great choice. It’s not only about the health industry – this sector is set to revolutionize areas like food, fashion and even engineering. Developments are coming thick and fast, and picking up stocks now could stand you in very good stead, as well as benefiting humanity at large.
Investing internationally
Ask professional investors for the key to success and they’ll tell you not to put all your eggs in one basket. That goes for national economies just as it does for sectors and individual companies. Internationally, Europe is looking like a good bet at the moment, and there’s serious growth potential in the Middle East, which, thanks to political changes, US investors are now much better able to access.
Staying safe
In accordance with the eggs and basket principle, smart investors always try to establish a balanced portfolio – a little from here, a little from there, so that they can’t be wiped out if something goes wrong. This also involves balancing out any high-risk investments (generally the ones that offer the biggest rewards) with safer ones like government bonds. Beyond this, the most important rules are not to be impulsive about buying and not to get sentimental when it comes to selling, missing the best time slot as a result. Establish a strategy and stick to it. That way, anybody can be a successful investor.
