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Morningstar's Guide to Investing in 2018

SPECIAL REPORT: Looking for investment ideas to go with your New Year's resolutions? We bring you outlooks and predictions from the professionals

Emma Wall 2 January, 2018 | 11:41AM

Happy New Year from the Morningstar editorial team! Now that the turkey has been eaten, the tinsel put away and the in-laws have left, it is time to turn your thoughts to the year ahead. 

Whether you are a stock market optimist or a cautious cash-hoarder, make sure you include some financial pledges in this January's New Year's resolutions. Alongside the usual health and well-being vows, how about a wealth check-up and a portfolio review? Your bank balance – and your retirement income – will thank you for it.

Adrian Lowcock, investment director at Architas suggests now is the perfect time to review your investment goals.

“We all have different reasons to invest and it is important to remind yourself what the investments are for. This can impact your attitude to risk and your ability to tolerate a loss,” he says. “Only buy something that fits into your portfolio - Fund ideas and recommendations are not made specifically with you in mind. Think about how a new investment would fit into your portfolio, and how will it affect your risk exposure, liquidity and diversification.”

2017 was a good year for investors, with asset classes across the board rising, and almost all geographies making gains. But the laws of gravity apply to markets, and what goes up must - at some point - come down.

When the correction is due is a matter that divides the professional investors; some predict a crash of 30% in the near future. Others say that the macro backdrop is so irretrievably altered by quantitative easing that all bets are off, and this rally could run for quite some time yet.

Samy Chaar, chief economist for Lombard Odier, believes there may be more gains to be made.

“After a year of strong economic and financial market performance, with volatility printing historical lows and asset valuations looking increasingly rich, investors are naturally questioning the sustainability of current trends. Are we nearing the end of the cycle? Our answer would be – not yet,” he says.

“Forecasting a breakdown scenario for 2018 requires expecting either that an exogenous shock hits the global economy or that an endogenous negative feedback loop takes hold. While clearly always possible, the former is unpredictable by nature, and unlikely in our view. It would certainly be complicated to base an asset allocation on such a premise.”

This week we aggregate the thoughts of the great and the good in our guide to where to invest in 2018. We will share the predictions and outlooks of economists and fund managers, alongside top tips from advisers and fellow investors to put you on the right path for your most profitable year yet. 

Tuesday: The UK

Will 2018 be blighted by Brexit? Which domestic stocks offer the best value?

How Would a Corbyn Government Affect Your Investments?

New Year's Resolutions: Brexit, Bitcoin and Property

3 UK Equity Funds Due a Bounce

Will British Stocks be Blighted by Brexit?

How Brexit Will Impact Bonds in 2018

Rodney Hobson Urges Caution Over UK Retail Stocks

Wednesday: Europe

Greek debt and the Continental recovery

Top-Rated European Funds and Trusts for 2018

European Equities Poised for Another Solid Year

Interest Rates in Europe Set to Rise Over Next Decade

Schroders: Expect More Volatility in European Bonds

Thursday: The US and Japan

Trump, tax, Abenomics and value investing

US Outlook: Tech Stocks Too Expensive, Retailers Too Cheap

Killik's 3 Stock Picks for the New Year

Why Japan is the Fund Picker's Favourite Market

Lombard Odier: Stock Market Rally Isn't Over Yet

Developed Market Bonds are Significantly Overvalued

Friday: Emerging Markets

Which of the emerging markets will soar in 2018?

How to Invest in Emerging Markets

Asian Markets Offer Growth for Stock Pickers

Commodities Outlook: Gold Price to Fall in 2018

Alternative Assets Offer Investment Income

 

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author Emma Wall

Emma Wall  is Senior Editor for Morningstar.co.uk