As this year comes to a close, it’s an exciting time to start thinking about the future. Kicking things off on the right foot with your finances is a great idea. One way to do that is to start planning your investing strategy for stocks and shares.
The expert analysts at Hargreaves Lansdown have put together their top five UK shares to watch next year. Keep reading to find out who they’re getting excited about, along with some investing tips for you to mull over whilst you wait for 2022 to begin.
One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.
What are the UK shares to look out for in 2022?
Here’s a breakdown of the five stocks and shares that the analysts Hargreaves Lansdown believe could have a fantastic 2022.
1. Anglo American (AAL)
This is a major mining company that operates globally but is based in the UK and listed on the London Stock Exchange.
The bulk of the firm’s revenue is via a diverse collection of materials ranging from iron ore to diamonds. A big reason Anglo American made this list is because of the potential to generate huge profits once fixed costs have been met.
Rising inflation has been a big talking point this year and is likely to impact 2022. This could help these commodity shares to perform well.
2. Lloyds Banking Group (LLOY)
Lloyds shares have been a popular pick for many analysts making forecasts for 2022.
You probably know of the bank in some way, even if you don’t use any of its services yourself. Part of the reason many are predicting a great future for the company is rising interest rates.
It’s not only savings accounts that are affected by interest rates but also mortgages and loans. Lloyds is one of the biggest lenders in the UK, and rising rates will likely lead to rising profits for the bank.
However, it’s important to bear in mind that there is the danger that a poor economy will discourage lending and stagnant rates could dampen growth prospects.
3. Polar Capital Holdings (POLR)
The shares for this fund management group can be found on the Alternative Investment Market (AIM).
Although it’s not one of the biggest asset management firms in the UK, Polar Capital has performed well recently, with a thematic investing approach in tech and healthcare.
These sectors have done well in the last couple of years, but investing sentiment could blow in a different direction. And that could lead to a frosty situation for these shares.
4. Smith & Nephew (SN)
As a manufacturer of medical devices, this firm is definitely one to look out for in 2022.
The company didn’t have a strong 2021, but the bulk of its business is based around medical fields that have been neglected in the wake of the coronavirus pandemic.
However, a return to normality and smoothing of supply chain issues could leave these shares primed for a big rebound in the coming year.
5. Tate & Lyle (TATE)
You may be familiar with this stock due to its tasty golden syrup – something I love to drown my pancakes in! The company doesn’t actually own the syrup, sugar and treacle brands anymore. Now, it produces sweeteners and thickeners.
Although the company has a track record of slow growth, the shares could see a rebound. This will depend on whether it’s able to follow through on plans to discard some of the poorer pieces of the business in early 2022.
How can investors find exciting shares in 2022?
When you start researching the shares you could add to your portfolio next year, here are some things to consider:
- Strategy – before doing a deep dive on shares, do a quick overview of the business to see if the stock fits in with your investing strategy.
- Growth or income – consider whether growth or income shares are more suitable for your situation.
- Diversification – make sure you don’t already own too many similar stocks to keep your portfolio diversified.
- Asset allocation – it may be the case that you need to think about using other assets, such as commodities or bonds, instead of shares.
What else do investors need to know about buying shares in 2022?
If your New Year’s resolution is to invest more, then that’s an exciting step! If you need a complete refresher on how this whole investing business works, make sure you check out our complete guide to share dealing.
Unfortunately, you can’t control how the markets will perform. But there are a couple of things you can decide for yourself. The first is to make sure you’re using a top-rated share dealing account, and the second is to ensure you’re benefiting from a tax-friendly account, such as the Hargreaves Lansdown Stocks and Shares ISA.
Just remember that the world of investing can be unpredictable. You may get out less than you put in. So try to keep a long-term mindset and never put more into the markets than you can afford.