Top ISA tips from the experts
With official figures showing Britain is finally out of recession, it may be tempting to think that investing will be an easier ride this year. But the 0.1% economic growth in the last quarter of 2009 shouldn't fool you into thinking the worst is over.
Many investors who held their nerve last year when the markets hit rock bottom were handsomely rewarded by the rally in the second half of 2009. Comparatively, plump returns may be harder to find this year.
To help ferret them out we asked a panel of highly regarded independent financial advisers (IFAs), including Mark Dampier from Hargreaves Lansdown, Darius McDermott from Chelsea Financial Services and Jennifer Storrow of Gee and Co, to recommend their top fund picks for 2010.
From their answers, we've put together 50 favourite funds to suit different investors' needs.
Many IFAs recommend clients increase their emerging markets exposure to keep in line with its increasing percentage of global GDP (almost one third by the end of last year).
First State and Aberdeen both have great reputations in this sector and members of our panel predict they will perform well again this year.
Income seekers were troubled by low interest rates and slashed dividends last year. This year, however, they could do worse than M&G, Schroder and Invesco funds, which are mentioned by several of our experts in the income sector.
In terms of growth funds, which should provide a solid bedrock in long-term portfolios, Fidelity and Jupiter receive a lot of praise.
A couple of our experts also suggest using a FTSE All-Share tracker fund for broad core exposure without the high management charges - HSBC's tracker is seen as a good low cost option.
Specialist funds, when used sparingly, can play a crucial role in any portfolio, providing potential for high returns, although not without added risk.
M&G Property Portfolio and Jupiter Financial Opportunities are two of the funds recommended by our advisers to spice up your portfolio, but all specialist funds should be handled with care and investors need to be prepared for ups as well as downs.
We also asked our panel for some pointers on unloved sectors, and the funds within them that might exceed general expectations in 2010. Property and technology were both highlighted, with global smaller companies and North America as alternatives.
This article was originally published in Money Observer - Moneywise's sister publication - in March 2010
The total money value of all the finished goods and services produced in an economy in one year. It includes all consumer and government consumption, government spending and borrowing, investments and exports (minus imports) and is taken as a guide to a nation’s economic health and financial well being. However, some economists feel GDP is inaccurate because it fails to measure the changes in a nation's standard of living, unpaid labour, savings and inflationary price changes (such as housing booms and stockmarket increases).
Generic, loosely-defined term for markets in a newly industrialised or Third World country that is in the process of moving from a closed economy to an open market economy while building accountability within the system. The World Bank recognises 28 countries as emerging markets, including Argentina, Brazil, China, Czech Republic, Egypt, India, Israel, Morocco, Russia and Venezuela. Because these countries carry additional political, economic and currency risks, investors in emerging markets should accept volatile returns. There is potential to make large profit at the risk of large losses.