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Picking stocks for 2025

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January 30, 2025

TLDR: The Financial Times' annual stockpicking contest is taking place amid a potentially volatile year with expert advice from Alan Livsey, Rob Armstock and Aiden Reiter.

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In the latest episode of the Unhedged podcast, the Financial Times team, led by Rob Armstrong, engaged in their annual stock-picking contest for 2025. This contest is both a fun exercise and a forum for discussing stock strategies in a potentially volatile market. This blog summary outlines the key takeaways and insights shared during the episode.

Overview of the Podcast

Contest Details

  • Participants must select five stocks by a specific deadline, focusing on individual names rather than mutual funds or ETFs.
  • The contest's stakes, despite being hypothetical, add a layer of excitement and competition among the hosts.
  • Key theme: This is not financial advice.

Host and Guest Introductions

  • Rob Armstrong is joined by colleagues Aiden Reiter and Alan Livsey.
  • The discussion revolves around market predictions and stock selections for 2025.

2025 Market Predictions

Expected Volatility

  • Alan Livsey predicts a year filled with market turbulence, citing potential political disturbances, particularly from Trump.
  • The Federal Reserve’s actions, including interest rates, will significantly affect market dynamics.

Impact on Investment Strategies

  • Interest rates: With anticipation of continued pressures from global political figures, gold emerges as a favored play due to expected increases in demand.
  • Macroeconomic factors: The discussions hint at high volatility having a dual impact on trading and investing decisions in 2025.

Stock Picks and Strategies

Alan Livsey's Picks

  1. **Gold Mining Stocks:

    • Junior miners like Dundee Precious Metals and Oceana Gold due to their high beta and leverage to gold prices.
    • Gold is seen as a strong play considering increased institutional buying and geopolitical instabilities.**
  2. **Short GAM (Swiss investment house):

    • Cited as a company in a long-standing decline, with predictions that it could go to zero.**

Aiden Reiter's Picks

  1. **Short Google:

    • This controversial pick is based on the premise of Google's struggles with AI efficiency and ongoing antitrust trials.**
  2. **Private Credit Companies:

    • Betting on an easier market climate for these entities despite prevailing skepticism around their sustainability.**

Rob Armstrong's Picks

  1. **JP Morgan Chase:

    • His "boring" pick focuses on the stability and expected profitability of big banks in a volatile market.
    • Conclusion: Strong banks prosper during market fluctuations.**
  2. **Vulcan Materials:

    • This aggregates company is seen as a safe bet due to its monopolistic advantages in local markets and potential demand from infrastructure projects.**
  3. **McKesson:

    • A solid play in healthcare, expected to rebound in popularity amid economic growth.**

Key Takeaways

  • **Diverse Stock Strategies:

    • Each host presents a unique approach to stock picking, ranging from safe, conservative bets to high-risk, volatile plays.**
  • **Understanding Market Conditions:

    • A deep dive into how external economic and political factors heavily influence market performance and stock choices.**
  • **Importance of Gold:

    • Broad consensus on gold being a suitable asset amidst uncertainty, highlighting a shift in investor sentiment.**
  • **Antitrust and Regulation Environment:

    • Tech firms, especially Google, are under scrutiny which shapes the investment landscape.**

Conclusion

As we look ahead to 2025, the selections and insights from the FT's expert hosts offer a fascinating glimpse into how current and anticipated market conditions could influence stock performance. Their discussions illustrate the complexity of market dynamics and underline the importance of informed decision-making in investment. Whether one prioritizes stability, growth potential, or speculative investments, staying attuned to economic indicators and expert analyses will be vital for navigating the coming year.

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