2024 has been a great year for my investment portfolio. Obviously, the year isn’t over yet, but as I write this in late December, I’m on track for an annual return of around 20% across my Stocks and Shares ISA and pension.
Here, I’m going to reveal how I’ll be investing my portfolio in 2025. Let’s dive in.
Funds for diversification
I invest in a mix of funds and stocks. My goal is to build up a substantial portfolio for retirement (which is probably still 15+ years away), and I’m willing to take on some risk in the pursuit of strong long-term returns.
Within the funds section of my portfolio, I have exposure to several low cost global tracker funds. Examples here include the Legal & General International Index Trust and the Legal & General Global 100 Index.
But I also allocate capital to funds that I think will either beat the market or provide some protection against a market meltdown.
One example of a product I’ve invested in for extra growth is the Blue Whale Growth fund, which is managed by Stephen Yiu. I’ve been invested here since 2019 and it has done well for me. For the first 11 months of 2024, it was up 23.6%. Last year, it was up 30.7%.
Stocks for extra growth
I also manage my own individual stock portfolio within my ISA and SIPP. Here, my aim is to beat the market.
My strategy involves investing in high-quality growth stocks that are poised to benefit from powerful long-term trends of themes.
When I talk about ‘quality’, I’m referring to companies that have competitive advantages, high levels of profitability, and strong balance sheets.
With this portfolio, I take a global approach. Increasingly, my capital is going into US stocks, as that’s where a lot of the growth is today.
As we head towards 2025, my largest holding (and one I’m very bullish on) is Amazon (NASDAQ: AMZN).
The reason I like this company is that it has many ways to win.
Obviously, it’s got the e-commerce division. I shop from Amazon almost every day now and it saves me a huge amount of time.
But it’s also got its fast-growing cloud computing. This is what really excites me. Here, the company is doing really innovative things with artificial intelligence (AI) chips. It’s also releasing brilliant new generative AI products.
On top of this, the company has video streaming. Here, it’s making a ton of money from digital advertising (it’s now the third largest player in digital advertising globally).
Of course, Amazon has plenty of competition today. This is true across all its divisions so there’s a risk that its success could be undermined on multiple fronts.
This company is a winner however, so I’m willing to back it.
I’ll point out that I do allocate a bit of capital towards more speculative stocks. Currently, I have shares in the likes of cybersecurity company CrowdStrike and online shopping powerhouse Shopify. But I keep my positions here small. That way, if they tank, my portfolio is not badly affected.
Cash for opportunities
Finally, I will note that going into 2025, I am sitting on around 10% cash. This will give me some firepower if we see a short-term pullback in the markets.
The post After a 20% gain in 2024, here’s how I’ll be investing my Stocks and Shares ISA and SIPP in 2025 appeared first on The Motley Fool UK.
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Ed Sheldon has positions in Amazon, CrowdStrike, Shopify, Blue Whale Growth fund, Legal & General International Index Trust and the Legal & General Global 100 Index. The Motley Fool UK has recommended Amazon, CrowdStrike, and Shopify. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
