In 2023, let's invest in indices

The first month of 2023 is ending, but many stockbrokers are just now getting into active trading, so it's not too late to talk about the major trends on which to make money in 2023.

It would be possible to fall back on the banal arguments that the most relevant stocks now are the MIC or pharmaceuticals. But I think that at the current moment, index investing and, perhaps, index commodity investing are more relevant than ever. Predicting the movement of individual industries over the medium to long term is hard, and markets are always growing. Every Russian investor has the opportunity to invest in indices through futures and swap contracts.

Let's start, perhaps, with a breakdown of stock indices. And if there is interest, which you will indicate in the comments, then in the next reviews we will break down the prospects for commodity contracts.

Undoubtedly, our market is now the riskiest, but also potentially the most profitable. Let's look at .

Graph 1. Moscow Exchange Index (monthly slice). Graph 2. RTS Index (monthly slice).

At the moment, the technical picture on the Russian indices does not suggest quick purchases. Moreover, the market warns that everything is not so simple with attractive for many stockbrokers purchases on fall. It is possible to get into that situation from a stock exchange joke: "You bought a bottom, get the second one as a present".

The new instruments that appeared on the Moscow Exchange last year allow us not to get frustrated in the absence of ideas for medium- and long-term investments, and to pay attention to other markets. For example, Chinese indices. It is now relatively free to invest via futures in the Hang Seng Index (we have this futures not directly on the index, but on the ETF, which carries risks under certain conditions, but so far there are no threats of their realization).

Graph 3. Hang Seng Index (monthly slice).

Seeing the Hang Seng index above the downtrend of March 2021 and reading the news about the new covid policy, it is hard to resist an instant buy. But still, if we are talking about positions that can be held for more than a week, it is worth waiting at least until the end of the Chinese New Year holidays.

Graph 4. S&P 500 Index (monthly slice). Chart 5. Nasdaq 100 Index (monthly snapshot).

The U.S. indices also seem to be saying that it is worth putting investments in them on a slight pause and talking about pessimistic scenarios for the time being. The technical analysis of the U.S. stock indices first of all shows that the high-tech sector may be more resilient in case the quotations continue to decline. There are no clear downtrends and much closer support. So, if you are not yet ripe for index investing, it is better to look for ideas in individual stocks here as well.

Notwithstanding the above, I consider index investing to be a top idea for the next year, or maybe the next few years. Ideas in individual stocks in a storm are twice as dangerous as usual. It's just worth waiting for an adequate correction to support levels, or a hardening of rising moves and a breakout of resistances. The markets are defining now, and tomorrow the signals may come, and you have to act fast. Keep your hand on the pulse!