In a world of uncertainty it can be hard to predict the future, especially when it comes to investing your money. Whether you’re new to investing and looking for investment opportunities or you regularly speculate, if you’re looking to invest in 2021 it’s time to invest for the long-term with a low-cost diversified portfolio and only check your balance occasionally – as markets can change rapidly.
Here are some of the most profitable investments to make in 2021.
Dividend Paying Stocks
Passive investments are the perfect way to invest because they enable you to earn money while you’re busy doing other things, and dividend paying stocks do just that. While they may not provide the explosive price appreciation seen with pure growth stocks, they do offer steady and predictable returns. And it’s because of these steady returns that ensures a regular cash flow.
Thanks to the announcement that the Stamp Duty holiday is being extended, now is the perfect time to get into property investment. Whether you choose to invest in a buy-to-let property and use the rental income to generate a regular and passive cashflow, or you choose to lend money to experienced developers and in return receive a meaningful equity contribution on every level, there’s no shortage of investment opportunities out there.
When you buy a bond, you’re essentially lending money to an entity. This can be a business or in the case of Premium bonds, government-owned. Where companies issue corporate bonds, local governments issue municipal bonds. While the rate of return for bonds is typically lower than it is for stocks, they tend to be lower risk.
Over the last few years and no more so than last year, we’ve seen a shift to working from home and shopping online. This means sectors associated with the digital transformation of our lifestyles are the ones to watch in 2021.
Look for opportunities in cloud computing, online retail and consumer electronics, as these are expected to generate superior profits growth. Companies developing cyber and artificial intelligence software will also be long-term structural growers.
Healthcare was in the spotlight in 2020 as we clapped for NHS workers throughout April and May, and the collaborative efforts of scientists were heralded around the globe as vaccinations were developed in record time.
Previously, healthcare has not been considered interesting from a growth of investment point of view for a number of years. But the coronavirus has highlighted that we need more innovation and revealed inequalities in access to healthcare and health outcomes to for different groups.
A key area within healthcare which is set to yield high returns – and rewards, is biotech.
Despite having the first confirmed case of Covid-19 and suffering through the worst of the pandemic in the initial months of 2020, China emerged stronger, reflected in its disease-control strategies and the success of the Chinese stock market.
2020 saw foreign direct investment into China rise by 6.4% leading to multi-national companies increasing their investment in the country. If you’re looking to increase you exposure to China, you can invest in UK-based multinational companies that do business in China.