15.04.2014 - Best investment ideas for 2014
If you want to invest in the right stocks and make a profit, you need to have a global understanding of the world's economic processes.
We see big opportunities for investors in any situation, despite the economic crises or geopolitical environment in the world. There are a number of indisputable factors that our experts (analysts, risk managers, and portfolio managers) use in order to come up with a list of the most promising investment opportunities for 2014.
We see large opportunities for investors in any situation, despite economic depressions and the geopolitical atmosphere in the world.
There is a number of irrefutable factors that our experts and analysts used for predicting a list of the most promising directions in 2014. You can read about them below:
I. IT, despite thousands of start-ups around the world ending as a failure, it is still one of the most dynamic and advancing areas in the market.
The most promising companies of this year will include those who develop software for mobile devices and social networks. Also, the internet commerce is still on the rise, and its volumes are growing day by day. As such, the capitalization of the Fusion-IO stocks rose by 29.74% in a year, and the capitalization of the company reached 1.23 billion dollars. Choice of instruments is normally quite diverse: from millions to corporations with tens of billions of dollars.
II. There is one more segment worthy of attention, it is the power industry. Certainly, the traditional heat generating companies, dealing with extraction and processing of coal, black oil, and nuclear energy are a safe investment because of the opportunity to recieve steady dividends and the low demand elasticity on energy. The average growth of its stocks amounted to 25% in 2013.
However, alternative energy sources have been a more attractive avenue for growing your capital in the past years. To speak about environmentally friendly products, which is the most topical issue of today's world, we need to mention the manufacturers of electrocars and their maintenance providers . One of the most well-known companies that produce such electrocars is the American corporation TeslaMotors, whose stocks skyrocketed in price by 460% in the last year. It is obvious, that we are at the dawn of a new era in the field of automotive industry and the change of the internal combustion engine for an electric motor. Start-ups in this field are predicted to be consumed by the automotive industry giants, that's why they present a colossal opportunity for potential investors.
III. Agriculture has traditionally been a stable field and promises to hold its level. This can be explained by the ever-increasing food demand in the world. In regards to the high-risk investments, we recommend to choose companies that have been dynamically growing in the countries of Latin American, South-East Asia, and the former Soviet Union countries. Near Eastis another point of attention. Stocks of a Dubai agricultural company - AmiraNatureFoods have become the most promising investment, they have risen by 168% in a year.
IV. Various financial experts have contradicting opinions on investments in the pharmaceutical industry . However a development of a revolutionary drug may allow to increase the capitalization by 20-40% annually even for a large company. That's why this sector can be viewed as promising and potentially profitable, however we recommend to limit its part in the entire portfolio. It's worth noting there were 65 startups of biotechnical companies in 2013 that attracted 7.5 billion dollars, as opposed to 2.1 billion dollars in 2012.
V. For more conservative investors there is an opportunity to invest in index funds . Following the market behavior, there is always a chance to find profit, even in the case of decline. This has to do with the fact that theoretically indices decline rate is three times faster their growth rate. Today, considering the reduction of the Quantitative easing policy, we can see the growth deceleration or correction. However, in the case of the steady rise of the USA economics, the unemployment level will keep on declining while the purchasing power will be rising. Thus, we will see another rally next fall after the correction. You should always keep in mind a high probability of a new phase of economic stimulation within the Eurozone, which will support the market growth in the future.
VI. To speak of the best risk-to-yield ratio ideas, you must direct your attention to the two instruments - gold and the USD\JPY currency pair. Despite the current fall of prices on metal, investment funds attract money because of the rise in geopolitical tensions in the world, and also the uncertainty about the growth prospects of the USA stock market after finishing the Quantitative easing program. There may be negative factors, such as unprecedented production volumes, that can impede the gold price growth. But in any unforeseen situation, the investment society will undoubtedly turn its attention towards the problem. The monetary policy of the Bank of Japan, aimed at strengthening of the monetary base of the country, as well as reduction of the quantitative easing in the USA will likely bring the USD/JPY pair to the level of 120-125 Yen per USD.
We remind you that the price of the Yen dropped by 12% in the last year, and probably will keep devaluating. Also, we have to mention that the Yen is part of the reserve fund, that's why in the case of rise in geopolitical tensions, the positive currency pair prospects have to be revised. However, we view this scenario as low-probability and recommend acting with the rise of the USD against the Japanese Yen in mind.
In a recent article from Forbes magazine, the leading financial advisors posted their list of the most promising investment opportunities this year:
Despite the successes of the past year in the stock market, some experts claim that this trend will persist throughout 2014 as well.
Forbes experts recommend buying stocks of the following companies:
â¢ Ballantyne Strong (BTN)
â¢ Rite Aid (RAD)
â¢ Omega Protein (OME)
â¢ LigandPharmaceuticals (pharmaceutical business)
â¢ TeslaMotors (electric car developer)
â¢ HCIGroup (government insurance company)
â¢ InternationalGameTechnology bonds with the yield of 5.5%
â¢ AQR Style Premia Alternative I fund (safe asset)
â¢ US Bancorp
â¢ Fidelity Select Construction&Housing
â¢ FelCor Lodging Trust
â¢ Philip Morris International
â¢ AppliedMaterials (the largest manufacturer of semiconductors)
â¢ Citigroup, Boeing, Celgene, Gilead Sciences Ð¸ General Motors
â¢ VF Corp
To conclude, we see that despite the depressions andmacroeconomic fluctuations in the world, there is always a way for a successful start-up, investment and trading in a stock market.
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