The professional team

Stockbrokers tips for 2012: left to right, Justin Urquhart, Paul Caviar and Andy Brough. Photograph: Antonio Zazueta Olmos

Andy Brough, co-manager of the Schroder UK Mid Cap Fund, Paul Kavanagh, partner with stockbrokers Killick & Co, and Justin Urquhart Stewart, a frequent stock market commentator on Radio 4's Today programme, are sanguine about the prospects for 2012, despite what they describe as "a complete lack of credible political leadership".

They point to recent positive indicators from the US, saying that an upturn in its economy is usually followed first, by the UK, and then, Europe.

They have selected companies that are producing a good performance, but which have not yet been recognised by the market, in the hope of benefitting from capital appreciation – a rise in the share price.

But they also have an eye on yields: even if the stocks fail to increase, at least a yield of 4% or 5% will ensure a reasonable total return. But given the ongoing uncertainty over the euro, there is one traditionally high-yielding sector that they prefer to avoid, for the first quarter at least – banks.

Kavanagh says: "I think we have to be slightly more risk averse to start with. But the nice thing is, we can adjust the portfolio after three months if things start to improve."

The professionals biggest worry is Orlando the cat's complete lack of risk awareness. "He doesn't appreciate the need for a balanced portfolio and could end up choosing shares which really take off this year," says Urquhart Stewart.

The team has bitter experience of competing against non-professional investors. Urquhart Stewart has been beaten by a chimpanzee selecting stocks with a banana, while Kavanagh narrowly beat Radio 2 presenter Jeremy Vine who picked his selection by throwing darts.

Their portfolio
British Gas
GlaxoSmithKline
Elementis
Avon Rubber
Imagination Technologies

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