What to do in 2012?

Investment options

Without developing again a full analysis of the financial markets, we will now consider the following possibilities, with an investment horizon of at least four to five years: Corporate bond funds with a maturity of around five years. The investment horizon has to be more than four years. Both return and security are better than with government bonds.

For those investing in France through insurance policies, SCPI's (real estate funds) offer a very regular return of around seven per cent a year, without taking into account a potential rise in the unit price over the coming years. As subscription fees are higher than for usual funds (around eight per cent, such an investment has to be made for at least five years.

In France, some closed funds are also issued for eight years. For instance, they offer a seven per cent return a year over eight years as long as the Eurostoxx 50 index does not drop by more than 50 per cent after eight years from the subscription date. Otherwise, the subscriber receives twice the index back at the end, which is possible but quite unlikely.

For those who are ready to take more risks, they could start to invest a little in European equities, which have dropped a lot, unlike the  US ones. They can also consider investing in Chinese equities and wait for a rise of consumption in this country. And those who do not want to take any risk can invest in the general assets of a French insurance company. In such a case, 100 per cent of the capital is guaranteed at any time by the law, and the guaranteed return can be as much as 3.5 per cent per annum until the end of 2013.

Of course, an asset allocation must be decided by taking into account all parameters from the personal situation of the investor.

RFP has proven to be a recognised specialist for this. Do not hesitate to contact us.

Independent Financial Advisor and Mortgage Broker

Tel: 04 93 00 11 26 or visit our website here.