There may be bumps ahead - investing in 2021



What should your investment strategy be going into 2021? It's been an incredible year for investing with record daily falls as well as rises, a pandemic, a US Election and of course Brexit still yet to be resolved with the end of year deadline looming and as yet no deal.

If ever there was a year for hindsight this was it. The opportunities were endless both to short the falls and ride the highs, but it was a brave investor that sought them, let alone timing them right. 

Investing in 2021
However, some clear trends were in play. As the pandemic spread, the fear-based pricing built into markets was always likely to lead to a readjustment and in the same way when word of a potential vaccine grew a sharp rebound was probable. As ever, fortunes were made and lost.

Going forward is, as ever, tricky. The long term effects on economies and particularly unemployment will remain in place in 2021, even if we get the record bounce that many are predicting as the world slowly gets back to normal. 

But what of poorer economies, will they continue to be affected by the pandemic due to lack of access to vaccines? A likely yes.

Will the travel, hospitality, energy sectors return to normal or a new normal that will shake up the individual players? Probably a new normal, but a rebound nonetheless.

With the record lows, it was a time for bargain hunting, looking for companies with good fundamentals harshly judged by the unprecedented events or indeed whole sectors hammered by the rush of bad news. Most of those sector rebounds are well underway, which brings us back to looking for companies with good growth/rebound prospects, a strong balance sheet, decent dividends, factors which have served investors well for many years.

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