Can you cash in on a Biden bounce

Is America’s bubble about to burst – or can you cash in on a BIDEN BOUNCE as Democrat takes the reins


PUBLISHED: 21:50, 23 January 2021 | UPDATED: 10:38, 24 January 2021

In the last few days, the world’s eyes have been on the United States as the presidency has transferred from Donald Trump to Joe Biden.

Thankfully, Biden’s inauguration has taken place without any repeat of the violence seen earlier this month.

Investment experts believe that under Biden’s presidency, the wind is set fair for more Washington spending and a return to growth when the US exits the pandemic. But is now the time for UK investors to invest in US stocks?

Since the Republicans position themselves as the party for business, some think that a Democrat presidency will be worse for the stock market.

Yet the Democrats’ new President was greeted by the S&P500 Index – comprising America’s biggest listed companies – posting a new high…

Investors will wonder whether this rapid growth can be sustained. Hollands describes US valuations as ‘extremely stretched’, with technology giants such as Facebook, Google and Netflix accounting for much of the market’s gains.

Yet, Terry Smith, one of Britain’s most successful fund managers, disagrees. In a note in recent days to investors in his £23billion Fundsmith Equity Fund, he said he did not expect technology stocks – most of which are US listed – to crash…

For those who want funds with a renewable bent, James Carthew, head of investment trusts at QuotedData, suggests three funds operating in the US market: US Solar, Ecofin US Renewables and SDCL Energy Efficiency.

All three are currently doing deals in the US, particularly in the solar energy area.

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