Any way you slice it, 2017 is shaping up to be an uncertain time for investors. The events of the past year have muddied the waters, as nobody knows for sure what an unfolding Brexit or Trump presidency will mean for asset prices around the world.
Nevertheless, sitting on the sidelines is not an option despite increased risk. There is a world of intriguing investment opportunities out there and you won’t earn a dime if you keep your capital on lockdown.
Keeping that in mind, there are several segments of the global economy we believe to be good investments in 2017 and beyond – check them out below.
Big Pharma companies
Despite all the bad press Big Pharma companies have gotten lately, the fact remains that (a) there is an inelastic demand for many of their drugs and (b) Republican majorities in the house and senate means any legislation drafted in the next two years is likely to treat them nicely.
Even so, the on again, off again threats of the Trump Administration to lower the price of prescription drugs has served to depress the stock prices of many companies, making many of them intriguing investment opportunities.
This makes them great buys when you contrast them against their book value and the high likelihood of Trump embracing standard Republican positions on health issues.
Inflation hedges
Since the massive whack that the world economy took in the Global Financial Crisis, prices of many goods have been either stagnant or in decline.
After a decade of interest rates close to zero around the world, though, signs have emerged suggesting the era of cheap money may be drawing to a close.
Interest rates have begun to rise in the USA, and they are set to do the same in other economies such as Canada.
Throw in a labor market which has begun to tighten and the specter of trade tariffs being raised regularly by the Trump Administration and it has become apparent that traditional inflation hedges may become a profit center in the months and years ahead.
At this time, parking your money in gold, minerals, energy, and financial stocks while they are still a great deal is strongly advised.
Japanese stocks/assets
Japan is another great place to look for bargain stocks, as the economic stagnation of this nation’s long-running economic stagnation has finally begun to shown signs of abating.
Corporate governance has improved recently, companies have improved their profitability, and the government headed by Prime Minister Shinzo Abe has been Japan’s most business-friendly administration in a long time.
For value investors, the fact that the average stock is trading at 1.3 times their book value makes this country attractive enough on its face, especially when you consider that the average is 3 times book value in America.
European stocks/assets
This may seem like bad advice given all the turmoil that has plagued Europe of late, but there is plenty to love about the assets of this continent.
The aforementioned events have greatly devalued stocks of legitimate companies, making it worth your while to investigate companies on the other side of the pond.
Focus your efforts on intriguing investment opportunities in Eastern Europe, as the price to earnings ratio of companies there is a quarter of what they are in America.
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