When returns are few and far between on the market it can be tempting for investors to look towards shares which have been sold off in the hope of making outsized returns when they eventually bounce back.

Sometimes these shares will turn around their fortunes and bounce back, but not always unfortunately. In fact, sometimes they will just drop further.

There are three shares on the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) which right now I feel are best avoided no matter how tempting they are to investors.

BHP Billiton Limited (ASX: BHP)

The economic uncertainty that the Brexit has brought about could be a cause of much concern for BHP Billiton and its shareholders. Should the UK and Europe fall into a recession then demand for commodities could drop, bringing prices down along with it. Prior to the Brexit a number of economists had already predicted that iron prices were going to drop in the second half of the year, so it’s not hard to imagine this being revised even lower in the coming weeks. Although its shares are down by almost 35% in the last 12 months I would still keep them at a safe distance. In my opinion BHP Billiton is great for traders, but not for investors.

Mesoblast limited (ASX: MSB)

Shares of this regenerative medicine business have dropped in value by almost 60% in the last three months after it emerged that Teva Pharmaceutical Industries had withdrawn from its late-stage trial of experimental stem cell therapy for chronic heart failure. Moving forward investors will no doubt have concerns about funding the rest of the trials without the financial muscle of Teva backing it up. The company explained that it will fund the trial with equity-based funding without the need for a capital raising. Whether or not this proves to be dilutive for existing shareholders’ holdings, we will have to wait and see. But for now I believe that if Teva saw no reason to continue the partnership, then there is no compelling reason for investing in the company despite it appearing cheap on paper.

Slater & Gordon Limited (ASX: SGH)

This embattled law firm is another share which has suffered heavy declines this year. The shares have been rising since its initial 80% drop, but I would resist any temptation to invest in this debt-ridden company today. Slater & Gordon’s management are aiming to improve operations with plans to restructure its loss-making UK businesses. But this will take a lot of time and patience from both investors and creditors. I would be very surprised if further down the line we don’t see some form of capital raising to help it with its debt burden. So for now, I would hold off an investment and focus on some of the more stable shares on the ASX like CSL Limited (ASX: CSL) and Cochlear Limited (ASX: COH).

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.