# which is the best stock market to invest in now



## mickymcie (22 Jun 2006)

Hi All
I have being investing in the Irish SAtock Exchange for the past couple of years and have being just lucky to have had some bank shares. I feel that it has reached its peak now. I was wondering what is the next stock market to have a high return or where is the money in stocks being invested now........


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## ClubMan (22 Jun 2006)

*Re: Stocks*



Also, please note the posting guidelines:



Speculative threads such as this easily stray into that sort of territory.


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## room305 (22 Jun 2006)

*Re: Stocks*



			
				mickymcie said:
			
		

> I was wondering what is the next stock market to have a high return or where is the money in stocks being invested now........



I'd stay away from most of the emerging markets territory, they've taken a battering but I think they may have further to fall. Markets like Russia will swollen with large amounts of global liquidity and with the age of cheap capital and low interest rates coming to an end it may be a while before they start producing the same kind of return again.

I guess a lot of it depends on your world view and your outlook for the global economy. Mightn't be a bad idea to diversify your portfolio somewhat and include some defensive stocks.


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## mickymcie (23 Jun 2006)

Thanks for the reply. When you say defensive stocks what do you mean????


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## CCOVICH (23 Jun 2006)

Stocks that perform well, or better than average during a downturn.  For example, tobacco and utilities.


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## room305 (23 Jun 2006)

Thanks CCOVICH, yes defensive stocks are stocks that provide consumer staples and things that people need. Since people have little choice but to purchase what these companies offer they tend to outperform the market during a downturn. Slow, steady, dependable growth is the order of the day with these stocks.

Think essential foodstuffs, gas/electricity and so forth. Also health care products, particularly anything to do with care of the elderly since this is a growing market.

Be sure to do your research, if everyone is thinking in this manner it is easy for such stocks to become overvalued!


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## gearoidmm (23 Jun 2006)

On bloomberg radio the other day, they were suggesting that now might be a good time to put more money into cash and bonds.  Japan is about to raise interest rates and that will take even more money out of the system; we may not have seen the bottom of the market yet.


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## mickymcie (23 Jun 2006)

Where does an individual get a quote on bonds. Is their a better return on Bonds or investing in deposit account usually?


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## bearishbull (23 Jun 2006)

Better off invested in funds than any one stock exchange, india and china are touted as the economic powerhouses of next few decades so long term you'd want exposure to them .


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## evan (23 Jun 2006)

"I'd stay away from most of the emerging markets territory"

what about resource rich latin american countries like chile and argentina,


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## evan (23 Jun 2006)

chile and argentina would be regarded as emerging markets. Surely it is not enough to just say stay away from emerging markets. Obviously the latin american countries that may nationalise their natural resources have to be watched with care. What do other people think of argentina and chile as investments.


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## room305 (23 Jun 2006)

If you believe in the fundamentals of oil and steel (i.e. they are going to continue to rise) then the Brazilian market might be worth looking at. The good thing about Brazil as an emerging market is that the interest rates are incredibly high but the economy is still growing. This gives the central bank there plenty of scope to reduce rates to stimulate the economy should it start to slow.

That said, I personally would prefer to put a portion of my money into an emerging markets fund and gain exposure to such markets that way. This is currently quite a volatile period for stocks and these markets can be especially volatile.


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## Chamar (23 Jun 2006)

I think a good short-term bet is China between now & Olympics. Chinese shares have underperformed relative to economic growth up to now.

But after 2008 all bets are off.


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## room305 (23 Jun 2006)

Chamar said:
			
		

> I think a good short-term bet is China between now & Olympics. Chinese shares have underperformed relative to economic growth up to now.
> 
> But after 2008 all bets are off.



I'd consider China a high-risk investment. Credit lending has spiralled out of control and the central bank is struggling to put a cap on it. There has been resulting widespread speculation on real estate that has pushed up prices, which as you can imagine is extremely unpopular with the people. From what I gather, China needs growth of about 10% yoy to keep at an even keel. This may be difficult to do given the need for interest rate tightening and the possibility of a global economic downturn.

There may be a reason why the market has discounted the shares relative to current growth.


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## mickymcie (24 Jun 2006)

bearishbull said:
			
		

> Better off invested in funds than any one stock exchange, india and china are touted as the economic powerhouses of next few decades so long term you'd want exposure to them .


 Can ya buy into a fund that would give ya exposure to those - If so where?


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## ClubMan (24 Jun 2006)

room305 said:
			
		

> Credit lending has spiralled out of control and the central bank is struggling to put a cap on it. There has been resulting widespread speculation on real estate that has pushed up prices, which as you can imagine is extremely unpopular with the people.


Hmmm. Sounds familiar!


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## bearishbull (24 Jun 2006)

mickymcie said:
			
		

> Can ya buy into a fund that would give ya exposure to those - If so where?


 many irish institutions offer them as well as international ones.best to serch this site and google .as someone above said china might be risky so i wouldnt buy chinese companies but international companies and hong kong based companies doing business there and many funds can offer that


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## room305 (24 Jun 2006)

ClubMan said:
			
		

> Hmmm. Sounds familiar!



 Too true! Though bad debts are also a concern. Some estimates have put potential bad debts at between $700-$900 billion. Assuming a conservative $200 billion of these do turn bad then there is a risk of a collapse of the banking system. The reserve rates for banks have been raised by the central bank but there is evidence they are being ignored or books are fiddled to feign compliance.

My key point I guess, is that putting money into emerging markets is not a one-way bet. It's high-risk and should be viewed as such, though the potential returns may justify that risk for some.


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