Investment strategy for 2013, what’s going on in Investment Management?

 

Quite simply after a couple of years sitting in cash, fixed interest and bonds, the appetite for the share market is returning.  Based on a recent Investment Management survey conducted by HSBC, 75% of global managers surveyed were holding an overweight view toward equities.  Part of this may be attributable to more positive sentiment toward the global economy.

Interesting statistic, but here’s the thing – what are you going to do?

After a period of time where uncertainty and nervousness has effectively corralled investors into saving, at the expense of both property and shares, is it time for you to get back in?

The answer, in my opinion, is a resounding yes.  That said, with care and caution as to what stocks to hold as always.

Looking locally at the Australian market, for example, the push up in iron ore prices from $90 USD to $145 USD, saw BHP drift down to around $30.70 – currently sitting at $37.16 (24^th Jan close).  That, by the way is a move equivalent to around 7 years’ interest with the current RBA rate of 3%!

So where else is the opportunity?? Well the banks – ANZ in particular – are approaching their dividend season, so perhaps some exposure to this and the associated fully franked dividends may be part of your 2013 Investment Strategy.  And then of course, we can layer on top of this, value add by selling calls, generating options premium.