Professional Investors Weigh In On Investing in 2018

Investors have been bullish about forecasts for the coming year, so far. The next year will most likely be quite eventful for the financial industry in general. The Federal Reserve recently made announcements that businesses should expect multiple interest rate hikes in 2018. Most financiers expect the short-term rates to rise somewhat, but nothing more serious than that. The reason for the interest rate spike is a strong economy and a low unemployment rate, which is a promising investment environment for the next year.

The S&P 500 has the Shiller price-to-earnings ratio at 32, which is more than double the average for long-term finances. That’s a good thing but it’s also one that makes investors cautious, says private equity financier and veteran investor Jason Sugarman. The current political climate also raises concerns at least among some. And yet, there are some sectors that will be highly lucrative for investing in next year, many professional financiers say.

The U.S. Market will be the Best Bet for 2018

Global recovery from the last financial crisis is still in the rebound stage, especially after international crises like Brexit and the fall of oil prices. In this environment, the safest market to invest in next year will likely be the US, says Jack Bogle, the founder of Vanguard, the largest mutual fund in the world. American companies continue to be highly innovative. The major tech advancements are still pioneered by companies based in the U.S. S&P 500 for annual average over a 10 year period was 8.04 for the U.S., while it was only 2.01 for the MSCI EAFE index that tracks stocks located outside of U.S. and Canada. Going by data and expert opinion, the majority of investors should be flocking to the U.S. market in the coming year.

Lucrative Stocks in 2018: Disney and Amazon

The retail giant Amazon reported remarkable billion-dollar earnings just on Black Friday this year, cementing a continuing shift of consumers switching to online purchases, even on a traditionally in-store purchase day. The other super stock of the coming year will most likely belong to Disney, the legacy brand that recently announced a historic mega-merger with 20th Century Fox. If the deal goes through, Disney would secure a massive chunk of the content industry, and prove to be one of the top players in the streaming sector. Investors who prefer stock will most likely see remarkable surges for Disney and Amazon stock in the coming year, predicts Jason Sugarman.

Bank and Tech Stock will Dominate in 2018

In addition to the above, tech and software companies continue to surge ahead and maintain high-quality stocks. Oracle and trucking company Paccar showed remarkable growth this year. Bank and technology sector stocks are speculated to perform especially well in the next year. The proposed high-interest rates would benefit banks the most. Continuing innovation in areas like virtual reality keeps tech stocks on the top level as ever.

While the typical cautions remain, 2018 is set to be a great year at least at first for investing in US stocks, among others. But investors are strongly advised to keep an eye on the news for political issues.

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1 thought on “Professional Investors Weigh In On Investing in 2018

  1. Easy to talk, harder to prove. This is interesting, but I’ll be more impressed at the end of the year, whether these investors are correct or not.

    I found the mention of bank stocks particularly interesting. I’ve been losing money on my Bank of America stocks for years now! My loss is now the best it’s been for some time: only -20%. If it ever gets to zero, I’ll be selling in a flash.
    Cindy Brick recently posted..Social Justice Warriors, Unite!My Profile

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