The Market Wrap 22-3-13

By Jason Fittler

The market has over the past week started to pull back.

For some time the market has looked over heated and certainly focused in the top twenty high yielding companies.

Although, I suspect that this will be a slow pull back over the coming months, we are now starting to get ourselves set. I expect that that investors will start to take some profits from the top twenty and will look to roll these funds into the next generation of out performing companies.

We have been researching what we think the next growth area will be.

I expect that yield will still be high on investors radar along with the quality of the company. However these companies will not provide the yields of the bank unless you are comfortable taking some more risk.

Companies such as BHP and RIO are now paying around the 4.5%, which starts to make these growth companies look better than cash. 

There are also a number of good quality companies, which carry a little more risk but at the same time have a strong business model, low debt and surplus cash.

Now is the time to start looking at the yield and growth combination story in the market.