The Tip Sheet

More top picks for 2025. MoneyWeek thinks things could be looking up for renewables and that now could be an opportune time to buy Greencoat UK Wind (UKW). Investors Chronicle meanwhile names four funds that could benefit from a recovery in the sector: UKW (again), Urban Logistics, Sirius Real Estate, Brown Advisory US Smallers. But in case a recovery proves elusive, the IC also tips Ruffer.

By Frank Buhagiar 07 Jan

MoneyWeek – Five stocks for 2025

Last week, The Times put forward five stocks to watch out for in 2025. One week on and it’s the turn of MoneyWeek. The article kicks off with an admission “Deciding where to invest for 2025 is a complex task; while opportunity abounds, there are various questions that investors will need to ask themselves.” Questions such as will the rally in big tech continue? Can the FTSE 100 build on 2024’s strong performance? How will the Autumn Budget impact the UK economy, and which stocks will benefit (or suffer) as a result? So, with these questions and more in mind, MoneyWeek has come up with a list of companies it believes are best placed to navigate what 2025 has in store. Among the MoneyWeek five, one of London’s investment companies – Greencoat UK Wind (UKW).

Fair to say, the renewables infrastructure fund, like the rest of the sector, had a tough 2024 with the share price ending the year off -15.7% “as the economic climate steered investors away from these kinds of longer-term, capital-intensive sectors.” But, as MoneyWeek points out, things could be looking up for the sector. “Infrastructure investments and green energy are likely to be key priorities for the Labour government, with significant investment promised in October’s Budget.” What’s more, that fall in its share price means that Greencoat is now trading at a 20.4% discount to NAV (net asset value), despite a dividend yield of 7.7%. Now could be an opportune moment to buy into this sector at a discounted rate.

Investors Chronicle – Investment Ideas of the Year 2025

Rather than come up with just five stocks for the year, The Investors Chronicle has gone one step further and put together five themed portfolios for the year made up of five listed companies each. One of these themes, rebounding trusts. For after a challenging few years for London’s investment companies which have seen share prices across the sector fall to chunky discounts to respective NAVs in response to the high interest rate environment, the tipster believes the tide is slowly turning. No surprise then that the majority of the five funds in the portfolio have seen their share prices among the hardest hit. “This year’s portfolio covers a broad range of sectors but trusts broadly fall into one bucket: recovery.”

Among the five, two property funds – Urban Logistics (SHED), a fund with a portfolio of warehouses in urban areas; and Sirius Real Estate (SRE), which invests in German business parks. Like property, renewable energy infrastructure, another sector that has found the going tough. And like MoneyWeek above, the IC plums for Greencoat UK Wind (UKW) to gain exposure to any potential recovery in a sector which “should be supported by Labour’s energy plans. Renewable assets are riskier than core infrastructure as there is an additional exposure to power prices to account for, but we remain confident.”

Next up, The Chronicle highlights Brown Advisory US Smaller Companies (BASC) as a way of tapping into a recovery in US small caps – after an extended period of underperformance, US small caps stand to benefit from falling interest rates and reshoring. Finally, should a recovery prove to be elusive and should interest rates remain stubbornly high, the IC’s final pick is Ruffer (RICA), the “multi-asset fund that holds some defensive stocks but also makes substantial use of bonds, gold and other alternative assets in the hope of defending shareholders from stock market crashes.” What you could call, a ‘just-in-case’ pick.