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Is Lloyds Banking group a good investment? #finance

It has been a bad year for investments with banks being hit the worse with the continued Brexit controversy. However, this could offer an investment opportunity in Lloyds Banking group. They have been adversely affected but the PPI problem has also persisted and that is a problem that will soon be over. Lloyd’s could now be a good investment opportunity. Similarly, Barclay’s seems undervalued but they haven’t been quite as aggressive when it comes to reorganisation. Lloyd’s has invested in online banking and closed down under-used branches. Lloyd’s recovered well following the 2008 credit crunch and so I think we could see a decent rise in its share price this year.

 Lloyds Banking Group

Lloyds Banking Group

Lloyds Banking Group isn’t the only opportunity I see. I think Taylor Wimpey could recover to 200p a share over the next year if there is no more political turmoil. With the “end of austerity”, house prices could begin rising again.

The pound sterling

We have to consider the value of the pound before we consider investing again. The pound fell sharply following the referendum and overseas companies are now considering investing in British companies and even considering takeover bids. British Telecom could soon become a little less British if it is taken over by a German telecommunications company which has been building a stake. BT shares could rise on a bid but it is difficult to assess the risk.

Companies to avoid are those that benefited from the falling the pound. Pharmaceuticals benefited at least in sterling terms from the falling pound and saw their share prices rise. A Brexit deal could see that phenomenon reverse with many FTSE 100 companies seeing their share prices fall as revenue in sterling terms falls.

Brexit

With Brexit negotiations still hanging in the balance, it isn’t a great time to be investing but there are always opportunities. Many companies struggling to find investment now are offering opportunities but maybe the struggle will prove too much as it was with Carillion? The odds are always stacked against private investors and so we should proceed with caution. The only thing we can count on is instability and so we can only make good returns by profiting from that instability. If a Brexit agreement is reached a few share prices could make good gains. I see the banks as a prime target but nothing is guaranteed.

Good luck if you’re investing if you’re taking a risk.

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