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I FTSE 250 it went back a few years ago, but in 2024 it was growing again. A new bull run may be set to surpass the FTSE 100? I intend to add average shares to my Stocks and Shares ISA in 2025.
What I buy will depend on what they look like when the money is ready in 2025. But if not much has changed since today, I’ll probably be choosing from the three possibilities below.
I have pruned a few that I consider very dangerous. Mostly small oil and gas companies, and minerals and commodity stocks. If I happen to buy in those sectors, I will stick to the FTSE 100.
Health benefits
Consider a company that owns and leases healthcare facilities, particularly GP surgeries, on long-term leases to the NHS and other clients.
Now consider the UK’s growing population and the growing demand for healthcare. Next, watch the share price fall so much that the climate bond yield reached 7.4%.
What we are looking at is that Basic Health Structures (LSE: PHP). It’s unpopular at least in part because it’s a real estate investment trust (REIT), and it’s unpopular regardless of their business models.
That is the risk I will face if I buy, I have properties for sale under the cosh while the lending rates are high.
But it would make my top three choices right now, if I were ready to buy today.
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That’s entertainment
ITV (LSE: ITV) shares several characteristics in common. It also has a tough five years, and the budget looks good. In this case, the forecast yield is slightly lower at 6.7%, but still very good.
ITV’s woes stem from a tough few years for advertising spending, coupled with ever-increasing competition in digital entertainment.
But against that, ITV Studios also provides a service for other competitions, and that can provide a defensive backstop.
The real question is whether ITV can keep its dividends going for the next few years. Company executives say yes, but the share price suggests that large investors are skeptical.
Looking at the forecast price-to-earnings (P/E) ratio of just 9.3 makes me want something.
Like the wind
I would like to buy renewable energy, in the form of Greencoat UK Wind (LSE: UKW).
It’s structured as a REIT as well, and I’m sure it backfires. Real estate is bad, so whatever it invests in must be bad, regardless of how it uses its resources productively. At least, that’s how the feelings look to me.
In the real world, this is a renewable energy infrastructure fund, and it owns a number of onshore and offshore wind farms.
Another risk is that there is a forecast of losses for the current year, and that could send the shares further down. But a return to profitability in 2025 with a P/E of less than nine puts this one on my 2025 short list.
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