Skip to main content

Investment theme for 2017



2016 delivered a shock election of President Elect Donald Trump. Elections in Europe set to dominate headlines in 2017. Anger is rising against islamic refugees in Europe - these conditions favor leaders like Marine Le Pen (of France) and Geert Wilders (of Holland) to win national elections. Germany is likely to shift to far right as well. This theme will be prevalent across Europe in 2017. Election of Donald Trump thaws the ice between US-Russia relations which can seen as a positive sign in the geopolitical scene in 2017. President Putin is undoubtedly the most powerful and decisive figure in the world as of today. It is in good interest of any nation to keep friendly relations with Russia. Russia made successful military gains in Syria, Iraq & Ukraine - with change of guard in Europe & US - the war against radical islam in Middle East is likely to expand more.

President Trump seems very unpredictable as of now with regards with almost everything be it foreign policy or economic agenda. Lot of campaign promises were made to reduce corporate taxes, loosening government regulations, boosting job growth in manufacturing sector, repealing Affordable Care Act. The rust belt of US is suffering due to slump in oil/gas/coal & manufacturing sector since years. The impact of new administration's policies on growth of renewal energy related business is also unclear. FED is likely to keep raising interest rates resulting in negative impact on housing market & auto sales. Oil prices also continue to increase. Given that two major Asian giants India & China are going through monetary and structural reforms & with political/economic uncertainties in Europe - the world economy is likely to remain flat or in fact negative for year 2017. Banking sector seems to be favorite pick on wall street for 2017 but the banking stocks have already rallied to the end of 2016. I am not selecting finance sector for 2017.

In light of of these uncertainties in US & world markets I recommend safe plays for 2017

JNK - Corporate bond index fund which is overweight in the oil sector

PFF - Preferred Shares index ETF

IHF - Health Care Providers ETF

IBB - Nasdaq Biotech ETF (Risky play but needed to balance the portfolio)


Comments

Post a Comment

Popular posts from this blog

Global Warming: A Modern Myth

‘Global Warming’ has been a buzzword in political circles in this decade. The western world continues to churn out ‘doomsday prophecies’ of the world coming to an end if nothing is done to contain the greenhouse gases in atmosphere. Most of the western media claims of a consensus among climate scientists that the earth is heating up due to increase in carbon emissions caused by human activity. According to them rising temperatures of our planet will lead to dramatic rise in sea levels, floods, wide spread droughts, intense heat waves, powerful storms, etc. The very concept of ‘warming earth’ is flawed since genuine data suggests that earth temperatures are falling rather than rising. Greenhouse gases are composed of water vapor, carbon dioxide, methane, ozone and CFCs. Water vapor has more than 70 % contribution to greenhouse gases. The world is currently focused on carbon dioxide with actually constitutes less than 10 % and out of that less than 2 % is due to man-made causes. The
7 comments
Read more

Future of Indo-US relationship under Obama Administration

Barack Obama’s phenomenal and seminal victory in US presidential elections created ripples all over the world. A man of color and a person far less tried than many of his elders in his party but far more gifted politically had triumphed on the night of November 4, 2008. He is a political whiz-kid who radiates a gracious charm and is capable of inspiring rhetoric. Obama’s minority identity and his approach to transcend identity politics leave deep impression among Indian communities. Left-Liberals back in India had a celebration marked by unrestrained revelry unwary of the potential impediments for India. Obama’s message of ‘change’ is a cabinet full of ex-Clinton administration hawks. Old liberals from the old school are back and desperate to solve all world problems. The new administration has already set its imperial aims to win Afghanistan and to do so it needs Pakistan’s Army to co-operate. In one of the interviews Obama said “We should probably try to facilitate a better understan
4 comments
Read more

Higher Education in the USA

Foreign students have always been instrumental in spurring a cultural and technological revolution in the US . International students not only bring ‘hopes’ and ‘dreams’ but also a major economic boost to the US . According to a report from the Institute of International Education , foreign students brought in a total of $14.7 billion to the US economy from their home countries to pay for tuition fees and living expenses in the year 2006-07. The US continues to attract lot of hopefuls from hundreds of countries. The number of students enrolling in US universities is soaring every year. The largest numbers of students to the US are from India followed by China . The procedure to fly to the US for graduate studies is quite tedious and cumbersome. A 4-year degree is usually required to pursue a graduate degree in US. The first and foremost step is to appear for GRE ( www.gre.org ) and TOEFL ( www.toefl.org ) since most US universities require applicants to have taken both the t
2 comments
Read more