Where To Invest Your Money In The Trump Era

Donald Trump is president, like it or not. And with a new administration comes changes in policy that will affect your portfolio. Some Trump policy changes and key Cabinet appointments came quickly, and their impact on financial markets has already started taking hold. In other areas, we have little more than general comments from the administration to indicate policy direction.

Whatever you may think about the changes, it’s a good time to assess the investment risks and opportunities — which sectors are likely to surge, and which might flounder — under the Trump administration. Here are eight worth examining:

1. Infrastructure opportunities brewing

Possibly one of the most obvious bets is in construction companies. Pipelines and giant walls are just two of the sorts of projects Trump has advocated during his first weeks in office. As a candidate, he also promised a $1 trillion infrastructure plan to rebuild many of the nation’s roads and bridges.

If he can convince Congress to pay for it all, there could be lots of money flowing to construction companies over the next few years. Industrial equipment maker Caterpillar could see some of this cash come their way to purchase the backhoes and bulldozers required for big projects. Cemex, a Mexican company that makes concrete and cement, could also do well.

The possibilities go beyond bridges and roads; there may also be major improvements and expansions to the nation’s communication networks and power infrastructure — a potential boon for companies that make and install things like power lines and fiber optic cables.

2. Energy industry shifts

Companies that mine uranium and run nuclear power plants are excited by the prospects under the Trump administration, owing to comments that suggest he’s pro-nuclear. Professionals urge care in investing in the industry, since it is quite volatile.

Oil and gas companies have also rallied, since Trump seems to be a friend to companies that pull carbon out of the ground. One strong indication was his appointment of Rex Tillerson, the former CEO of ExxonMobil, to be his secretary of state.

Trump often talks about revitalizing coal — in part by removing environmental regulations to rev up the industry — but problems with coal go beyond those regulations and are unlikely to be solved by the president. For one thing, plentiful natural gas has supplanted coal as the fuel of choice for utilities and other big users.

Trump’s comments also signal renewable energy may become a loser. If his policies lower gas and oil prices, people won’t be as quick to switch to environmentally friendly energy sources like solar. Additionally, federal subsidies for these industries may dry up.

While you can always buy shares in large companies like ExxonMobil or BP, it might be safer to look for a fund you like that trades in the sector. Check out, “Think Oil Will Rebound? Here’s How to Pump Some Profits,” for ideas