Leaving 2010 and Investing in 2011
‘Although the end of 2010 did show signs of improvement for the economy, it was still a rough and frustrating year, especially financially, for most Americans. Throughout the year, people struggled most with the U.S. stock market and its’ daily instability. On a more positive note, many people have high hopes for 2011, as many investors are beginning to gather more faith with the United States’ economic standing. Because the economy is slowly showing signs of a turnaround, many people are trying to figure out what companies are safe to invest in. 2010 was a period of uncertainty, which on the flip side, almost always offers different opportunities. For investors, purchasing a part of a company when its’ prices are low is smart and profitable, which is why 2011 may be a prime time to invest. This New Year offers a fresh and optimistic start for everyone, including both businesses and investors, which is why knowing where to invest is crucial for becoming successful in 2011.
With the housing market still in shambles, people are looking forward to the New Year and hoping that the housing market, along with the rest of the economy, picks up speed. They are also trying to figure out which companies they can successfully invest in. Because people can not just pick up and move, they are investing more of their time and money into fixing up and updating their existing homes. With this
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in mind, investors need to look into companies like Lowe’s and Home Depot- the large home-improvement centers. Last year, retail was hit hard, but the Mooresville, North Caroline-based Lowe’s kept afloat and “tried to limit the damage by cutting back on opening new stores, opting instead to invest in existing locations, re-launch its Web site and find ways to schedule workers more efficiently. The measures seemed to have worked,” added The Wall Street Journal.
Not only are home-improvement stores a smart investment for 2011, but so are discounted designer stores like the TJX companies. Not many people are still willing or can afford to pay full price for clothes and kitchen ware; most people want to take advantage of quality items at a thrifty price. TJX Companies are able to succeed in almost all types of environments because they are constantly growing their customer and vendor bases. They are also able to reach out to all geographies and income levels. They attract customers from the moderate, middle, and upper classes. As the TJX Companies stated, “In 2009, we ran our businesses with extremely low levels of inventories, which drove faster inventory turns and strong merchandise margins. We believe we can run even leaner and make our supply chain even faster and better.”
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With a struggling economy, people are also spending less on what they eat, which is turning people towards more fast-food. Yum Brands, which is the company behind many of the fast-food chains like KFC, Pizza Hut, and Taco Bell, is becoming even more popular among people looking to save money. Yum Brands are even doing well in China, as The Wall Street Journal states, “there is one quick-serve restaurant for every 2,000 American city dwellers, but in China, the ratio is one for every 140,000 urbanites.” Because fast-food chains are much more prominent in China, Yum Brands relies on China’s more profitable business. As The Wall Street Journal also added, “A slowdown in China likely would hurt Yum’s stock price.”
Other industries, which produce consumer staples of everyday life, are also key companies to invest in. Corporations like Comcast, Republic Services, and technology businesses like Cisco Systems, Google, and Oracle are also safe bets because they have become a necessity for most of the American population. Investing in something that is necessary is extremely important and generally a safe move for most people. Many investors are predicting a more successful 2011, which gives the country a greater sense of optimism. People need confidence in both the company and the economy in order to feel comfortable making investments like these.
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