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10 shares I would avoid in 2017

The share market has delivered a tough time for some stocks and companies this year. If a particular stock makes up a large percentage of your portfolio and then falls over 30% it can devastate your portfolio.

Next year could be just as volatile for some other stocks, so the below 10 stocks are the ones that I’ll avoid in 2017:

AMP Limited (ASX: AMP) and Perpetual Limited (ASX: PPT) are two fund managers that have had poor performances with expensive fees in their underlying funds.

Unless they start producing market-beating returns they could continue to lose market share and even funds under management – why stick with them when you could chose fund managers like Magellan Financial Group Ltd (ASX: MFG) or WAM Research Limited (ASX: WAX).

The resources resurgence has provided great returns for shareholders that managed to pick the low point, but it’s hard to see prices going higher than they are now.

That’s why I think shares like BHP Billiton Limited (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Whitehaven Coal Ltd (ASX: WHC) could be hitting their highs soon and will be lower in 12 months from now.

This year could be the year that Amazon finally comes to Australia and dramatically disrupts the food and retail industries. This wouldn’t be good news for stocks like Wesfarmers Ltd (ASX: WES), Woolworths Limited (ASX: WOW) and Metcash Limited (ASX: MTS).

It could be another bad year for the TV channel operators and there could be a slowdown in construction, which wouldn’t be a good set of circumstances for Seven Group Holdings Ltd (ASX: SVW).

Technology and sharing companies continue to grow, Uber could hurt taxi related company Cabcharge Australia Limited (ASX: CAB) even more in 2017.

Foolish takeaway

Volatility could be the theme of 2017, which normally produces a good opportunity for investors. It could also mean the reversal of share prices that have done quite well in 2016. That’s why I think it would be better to avoid the above shares, or sell some (or all) of your shares in these particular companies if you do own any of the above.

It may also be a good idea to avoid these shares too, and aim to only hold winners in your portfolio.

3 Rotten Shares to Sell, and 1 to Buy Today

After a double-digit rally for the ASX since 2016 lows, investors should be on high alert. You'll find a full rundown below of 3 shares we think you should avoid today plus one top pick worth buying even if the market turns south.Simply click here to uncover these stocks.

Motley Fool contributor Tristan Harrison 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.

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