2017:  the year it paid to stay invested

Jonathan Wright
Jonathan Wright
Fidelity Personal Investing29 December 2017

It’s the end of the year, a time when we look back on the highs and the lows of the last 12 months, exchange some comments around how fast the year has gone by and make some resolutions we know we won’t keep!

From an investment point of view, 2017 has been a fruitful year for those that remained invested, undeterred by the uncertainties of interest rate rises, elections across Europe, including our own in June and of course the ongoing Brexit negotiations.

Throughout the year the FTSE 100 has resolutely remained over 7,000, reaching a new all-time high of 7,636 points as I write, while the Dow and Nasdaq have also hit record highs this month, on the back of President Trump’s business-friendly tax reforms.

It is no surprise then to hear the world’s 500 richest people, as measured by the Bloomberg Billionaire’s Index have seen the value of their wealth increase by 23% so far this year. This increase is largely the result of booming stock markets, with Americans who have made their fortune in the technology sector dominating the list.

Jeff Bezos, the founder of Amazon, is top of the list and is currently the world’s richest man. His fortune has increased by $34.2bn so far this year to take his ‘net worth’ to $99.6bn. It’s been a great year for Amazon, of which Bezos holds a 16% stake. The company has just reported its biggest holiday season ever, with customers around the world shopping at record levels. In one week alone, more than four million people started free Prime trials or began paid memberships and in the period from Thanksgiving to Cyber Monday, nearly 140 million items were ordered through the online retailer.

Second place is Microsoft founder Bill Gates, who was knocked off the top spot in October, while legendary investor Warren Buffett takes third place, followed by Spanish retail tycoon Amancio Ortega in fourth place and Facebook’s Mark Zuckerberg in fifth place.

The US has the largest presence on the rich list with 159 billionaires, who added $315 billion over 2017, an 18% gain that gives them a collective net worth of $2 trillion. That said, the 38 Chinese billionaires added $177 billion to the Bloomberg index in 2017, a 65% gain that was the biggest of the 49 countries represented.

As expected technology was the best performing sector, with the 57 technology billionaires on the index adding $262 billion, a 35% increase that was the most of any sector covered.

With the US bull-run now in its ninth year, many investors will be wondering what the new year holds and whether stock markets can continue to rise. The year end is a good time to take a look at your portfolio and check it’s still on course to meet your objectives. A good starting point is to consider your reasons for investing. What are you principally saving for? Is it something specific like retirement? If so, is it quite imminent, or are you saving more for a rainy day, where the short-term ups and downs of the stock market are less of a concern?

Our Account Summary screen will show you how your Fidelity account is invested across geographical regions and sectors. You can find the link just below the total valuation figure when you login to your account. Maybe you are too exposed to certain sectors or regions and a bit of rebalancing is required? Maybe your investments need to be allocated differently across the main asset classes - equities, bonds, cash and property?

With so much noise around, it is wise to get an expert view on the market environment from professionals who monitor it daily. In the latest episode of MoneyTalk, we asked a number of investment experts for their view on what investors should expect in 2018 - you can watch it below.

Also, in January Tom Stevenson will be sharing his latest Outlook for the year ahead in a live webcast where you will have the opportunity to ask your investment questions directly to Tom. Look out for more details on this webcast in the new year.

Until then, on behalf of all of us at Fidelity Personal Investing, we wish you a very happy and prosperous new year.

Watch the full Outlook 2018 interviews with the experts

Important information

The value of investments and the income from them can go down as well as up, so you may not get back what you invest. When investing in overseas markets, changes in currency exchange rates may affect the value of your investment. Investments in small and emerging markets can be more volatile than those in other overseas markets. Reference to specific securities should not be construed as a recommendation to buy or sell these securities and is included for the purposes of illustration only. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment. Investors should also note that the views expressed may no longer be current and may have already been acted upon by Fidelity. Fidelity Personal Investing does not give personal recommendations. If you are unsure about the suitability of an investment, you should speak to an authorised financial adviser.