The US equity market has had a fantastic year with returns of over 25%. Can it last and is this the place to put my money is a question for many deVere group clients and indeed investors in general. I personally believe that much of the recovery is now priced in and we will see slower growth rates in 2014 and beyond. Personally I expect an increase of 6/8% going forward.

Other advisors are predicting growth of as little as 4%. Bloomberg today reported ‘Slower growth in productivity might have become the norm. A combination of forces may be at work. Chastened by the deep economic slump, corporate executives have reduced spending plans for factories, equipment, research and development. Startup businesses have been held back as would-be entrepreneurs find it harder to get financing from still-cautious lenders. And out-of-work Americans have seen their skills atrophy the longer they’re without jobs’.

As Bloomberg says I believe that we can only see fast growth is productivity increases and there is currently little sign of that.

Investors however can still make good returns in slow growing markets. Specialist fund managers can achieve these returns and the correct use of structured notes can also enhance client performance as I mentioned yesterday. In the next month I’ll suggest my personal choices for 2014.

In the currency markets I believe sterling is looking over valued at 1.63 to the dollar and I’ll be looking to move from sterling to dollars.

deVere FX can advise on their opinions going forward.

I’ll also look to sell sterling short, this is high risk and should only be done if you are an experienced investor.

The above opinions are my own and shouldn’t be taken as advice. Clients wanting advice should seek the advice of a professional financial advisor as each clients situation is different.

Nigel Green

November 27th