Buying a selection of investment trusts can be a great way to gain exposure to the stock market. Not only do trusts provide instant diversification, but they also tend to be very cost-effective.

Here, I’m going to highlight five top investment trusts I like for 2022. I’d be comfortable buying all of them for my own portfolio today.

Scottish Mortgage Investment Trust

Starting with investment trusts for growth, one of my top picks here is Scottish Mortgage Investment Trust (LSE: SMT). This is a global equity product that’s managed by Baillie Gifford. It has a phenomenal track record (its share price is up around 333% over the last five years).

There are a number of things I like about Scottish Mortgage. One is that it provides exposure to some of the world’s largest tech companies. Top holdings currently include Tesla, Tencent, and Nvidia. Another is that it provides exposure to unlisted companies, such as payments firm Stripe and tech platform ByteDance. Normally, three kinds of unlisted companies are only accessible to sophisticated investors through venture capital funds.

Now this is a higher-risk investment trust. That’s because it owns a lot of high-growth companies which aren’t yet profitable. If these kinds of companies fall out of favour in 2022, SMT could underperform. So I wouldn’t want to have too much portfolio exposure here. All things considered however, I think it’s a top investment trust for long-term growth. Fees are very low, at 0.34% per year.

Smithson Investment Trust

Another growth-focused investment trust I like is Smithson (LSE: SSON). This is a mid-cap/small-cap product that’s managed by Fundsmith. Since its launch in 2018, it has performed very well, returning 23% per year to the end of November. 

What I like about this trust is that, like its big brother Fundsmith Equity, it aims to invest in high-quality businesses that are dominant in their markets and have established excellent track records. This approach has delivered excellent returns for Fundsmith Equity over the long run and seems to be working for Smithson too.

I also like the fact it provides exposure to growth stocks that are more under the radar. Top holdings at the end of November, for example, included Rightmove, Fevertree Drinks, and Equifax.

One risk here is that the trust is quite concentrated. It only holds between 25 and 40 stocks which means that stock-specific risk could be relatively high compared to other more diversified trusts. I’m comfortable with this risk however, as I have plenty of other trusts, funds, and stocks in my portfolio. Fees here are 0.9% per year.

Allianz Technology Trust

My third pick for growth is the Allianz Technology Trust (LSE: ATT). This trust, which also has a five-star rating from Morningstar, is more niche in nature as it is focused purely on technology stocks.

One reason I like this trust is that it provides exposure to a broad mix of tech stocks. Not only does it hold the mega-cap tech giants such as Microsoft and Alphabet but it also holds smaller, up-and-coming players such as Okta and Snowflake.

I also like the fact that the trust is managed by the highly experienced AllianzGI Global Technology team, which is based in San Francisco. This location is only a stone’s throw from Silicon Valley, where many of the world’s top tech companies are based.

Of course, if technology stocks underperform in 2022, this trust is likely to underperform as well. So, I wouldn’t want to have too much portfolio exposure here. I think it could play a role in my diversified portfolio though. Fees are 0.8% per year.

Scottish American Investment Company

Turning to investment trusts for income, one of my top picks is Scottish American Investment Company (LSE: SAIN). This is a global equity product that’s also managed by Baillie Gifford. Its aim is to be a core investment for private investors seeking income. It has an excellent performance track record.

One reason I like this trust is that it has a very balanced portfolio. Unlike many other global equity trusts, it doesn’t have a huge US bias. At the end of November, around 33% of the portfolio was invested in US stocks, while 32% was invested in European stocks and 15% in Asian stocks. Top holdings at 30 November included Microsoft, Novo Nordisk, and Roche.

Now this trust doesn’t have a huge dividend yield. At present, it’s around 2.4%. However, it is a ‘Dividend Hero’, which means it has increased its dividend every year for at least 20 years.

One risk here is that the trust does hold quite a few growth stocks. This means that during market volatility, it could be more volatile than some other income-focused investment trusts. However, I see it as a good choice as part of a diversified portfolio. Ongoing charges are 0.7% per year.

Murray Income Trust 

Finally, I also like the Murray Income Trust (LSE: MUT). This is another investment trust that’s focused on income. Its goal is to provide high and growing income with some capital growth by investing predominantly in UK shares. It’s managed by Aberdeen Standard Investments.

Like Scottish American, this trust is also a dividend hero, with a great long-term dividend growth track record. In 2021, total dividends amounted to 34.50p per share, which equates to a yield of nearly 4% at the current share price. 

It’s not just the dividend track record that is impressive here however. Overall, recent returns have been very good as well. Over the five years to the end of November, MUT’s net asset value (NAV) rose 49%. By contrast, the FTSE All-Share Index returned 31% over the same period. Performance has been boosted by stocks such as Diageo, AstraZeneca, and Safestore, which are among the top holdings.

It’s worth pointing out that while this trust has an excellent long-term dividend track record, dividends are never guaranteed. It’s also worth noting that at times in the past, this trust has underperformed the market, due its focus on dividend payers. Overall however, there’s a lot to like about Murray Income Trust, in my view. Ongoing charges are 0.46% per year.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Edward Sheldon owns Alphabet (C shares), Diageo, Microsoft, Nvidia, Okta, Rightmove, Scottish Mortgage Inv Trust, and Smithson Investment Trust PLC and has a position in Fundsmith Equity. The Motley Fool UK has recommended Alphabet (A shares), Diageo, Fevertree Drinks, Microsoft, Okta, and Rightmove. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

In a perfect world, I could buy a host of stocks and hold them for the next decade. In the real world, this isn’t always possible. Companies change, management moves on and consumer tastes evolve. However, there are still some businesses that have a strong long-term vision with a positive sector outlook. In fact, here’s one stock I’m considering buying and holding for the next decade.

An innovative financial services company

The stock in question is IG Group (LSE:IGG). It’s a FTSE 250-listed company that was formed back in 1974. Although originally it was offering just gold trading, this later expanded to more asset classes. Today, there are many stocks, currencies, bonds and other assets that can be traded on the IG online platform.

It specialises in offering leveraged trading, known as a spread bet. This allows retail investors to bet on whether a stock will go up or down, without actually having to buy the stock. The leverage can mean that the investor can make large profits with only a small deposit. However, the flip-side is also true, meaning that the potential for large losses is amplified.

The company has grown significantly in recent years, particularly regarding its retail client base. Interest in the stock market has risen since the start of the pandemic from the retail segment. This has allowed IG to open more accounts. With more accounts open and high volatility due to the pandemic, IG posted strong profits before tax of £450.3m in fiscal 2021.

A stock to buy for the long term

There are a few reasons why I think IG is a stock to buy for the next decade. One of the main ones is that I believe the trend of higher retail participation in markets will continue. High engagement, particularly for the younger age bracket, should help IG to continue generating revenue. 

The company has also branched out to other wealth options in recent years, such as smart portfolios, ISAs and other lower-risk trading products. This should help clients to become ‘stickier’ if they can have more funds in one place.

Another reason I’d buy IG shares is for the income payout. The business has been paying dividends for many years with a healthy dividend yield. It currently sits at 5.39%. Given the strong history of dividend payments in the past, I’m confident that this can continue for the next decade.

Risks involved

Even though I’m bullish on the stock, there are risks involved. Spread betting is classified as gambling in the UK. In the past, IG has cut products as a pre-emptive measure, fearing tighter regulations. This was the case in 2017 when binary options were removed from the platform. If gambling rules are tightened in the future with respects to financial products, then this could negatively impact IG.

Another risk is that the business is really dependent on volatile markets. If stocks and currencies trade in tight ranges, then there’s little opportunity to make money from buying or selling. This isn’t a risk IG can do anything about, but it’s something I should be aware of.

Overall, I think that this is a stock to buy and hold for the next decade, and am considering buying the shares now.

Jon Smith and The Motley Fool UK have no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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Rising inflation is likely to be a key theme in 2022, so I’m looking at the top stocks that could do well in that environment.

The cost of living is surging. Several factors are driving rapidly increasing prices. Global supply chain issues and rising energy costs are two culprits. It seems like the effects of the 2020 lockdowns are still being felt today.

A global shortage of computer chips created delays in new car production and increased demand for used cars. Meanwhile, the cost of gas is soaring globally as a limited supply in Europe is met with increased demand from Asia. As such, wholesale gas prices in Europe have soared by more than 800% in 2021. I reckon this will likely have a knock-on effect on consumers and industries.

Fighting price rises

So what kind of stocks could do well in this environment in the coming year? I think the top picks for 2022 will display some key features. High-quality stocks could really stand out. These will include those with strong profit margins and pricing power. But don’t just take my word for it. Popular investor Terry Smith said this of high-margin businesses: “Having high gross margins means they can pass on input cost inflation to their customers.”

For the first half of 2022, I’m also focusing on stocks that aren’t pressured by high energy costs. I reckon companies that use a lot of gas and oil could face headwinds in the coming year, especially if they’re unable to pass on these costs to customers. Many companies are more digitally focused, and this could be an advantage in the coming year.

Quality top stocks

So which stocks demonstrate strong profit margins, pricing power and relatively low energy usage? I can think of several top businesses that fulfil these criteria. These include Games Workshop, which operates a niche gaming business with a loyal fanbase. It boasts 70% gross margins and tremendous pricing power.

Magazine publisher Future is increasingly operating online and is more of a digital publisher and media platform. It owns many popular magazine brands and makes its money from advertising and licencing. It makes it to my list with a 50%+ gross profit margin.

Experian is a data and information services company with several high-quality metrics including a 42% gross profit margin. This FTSE 100-listed firm provides credit information to global businesses and individuals. It also holds a strong market position and offers significant growth potential.

Unintended consequences

A word of warning, however. There can be unintended consequences to high inflation. It can push the Bank of England to raise interest rates. It already increased the base rate of interest to 0.25% from 0.1% in December. Persistent inflation in 2022 could see further hikes. What could it mean? A rise in interest rates can increase companies’ cost of borrowing. This can potentially reduce profits and could temper growth for my three top stock picks. Hopefully, operating with such large profit margins provides enough of a buffer if finance costs were to rise. Overall, as a long-term investor I’m comfortable that all three companies can withstand these economic shocks. As such I’d consider them for my Stocks and Shares ISA in 2022.

Harshil Patel owns shares of Games Workshop. The Motley Fool UK has recommended Experian and Games Workshop. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Another year beckons. It’s an ideal time for many investors to think about their investment objectives, review the portfolio and think about what the next big themes could be and what shares might do well. I for one have been doing all this, and this is how I’ll be investing in shares in 2022.

Investing in shares

As we go into 2022, there are perhaps more uncertainties than usual for investors. We haven’t, for example, had to worry about inflation or interest rate rises for quite a while. Supply chain issues are a relatively new phenomenon. A recurrence of concerns about the Chinese economy and especially the health of its property market is not helping. Yet all these issues could just as easily fade away into irrelevance in the coming months.

For long-term investors, it’s about keeping cool. This is what I’ll try my utmost to do. As a long-term investor, what I want to do is try and copy as far as my abilities and time allow is to try and replicate the behaviours of successful investors like Nick Train, Terry Smith and Warren Buffett. They all invest in different companies and have slightly different styles and methods. What links them though is their conviction, ability to stick through the tough times and all have outstanding past success.

That stems from being long-term investors in my opinion. So when thinking about investing in shares this year, I’m going to mindful that any new investment I buy must still be a good company in five years time. This is a simple litmus test for me. If I can’t convince myself a company will be bigger and better in five years time, then I won’t buy in in 2022.

Which companies could be better by 2027?

Having run through my portfolio, I’m confident all my holdings pass this test. One of the ones though that I have the most conviction in is Diageo (LSE: DGE).

My colleague Harshil Patel named the company his top British stock for 2022. Partly this was because it’s a defensive stock so its shares could be expected to do better than average even if the market falls. It should also be able to keep growing though. No small part of the reason why is because Diageo expects an extra 550m consumers to come of age this decade. That’s a lot of potential new customers for its drinks. 

I am very confident that by 2027, Diageo will be bigger and better. Management has a plan to grow. At its Capital Markets Day in November, CEO Ivan Menezes laid out new medium-term forecasts. The guidance was for annual organic sales growth of between 5% and 7% for the 2022/23, 2023/24 and 2024/25 financial years, compared with 4% to 6% from 2017 to 2019.

This growth is very achievable in my eyes. Along with a rising operating profit, I think Diageo could do well in 2022 right through to 2027. For me, it’s a top stock.

The big risk is that the shares aren’t cheap on a P/E of 34. So management needs to grow sales and profits otherwise the share price could underperform. 

The final word

Above all else, to make the most of the opportunity that investing in shares creates, I’m going to maximise my stocks & shares ISA. I remain completely convinced this tax-efficient way of growing wealth will help me retire early.

Andy Ross owns shares in Diageo. The Motley Fool UK has recommended Diageo. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Over the course of 2021, the US stock market has outperformed its UK equivalent. The NASDAQ, S&P 500 and the Dow Jones have all posted record highs. Here in the UK, the FTSE 100 and FTSE 250 are still some way from matching these levels. With that in mind, if I had £1,000 ready to deploy at the moment, here are some of the top US stocks I’d consider buying.

A popular US stock, but for good reason

The first is Amazon (NASDAQ:AMZN). Before people roll their eyes at such a generic choice, hear me out. I get that Amazon is one of the most popular stocks globally for investors. Yet there are good reasons for this. The share price might only be up 7% in the past year, but it’s provided a 4.5x return over five years.

The business is also still showing growth. In its Q3 filing, net sales were up 15% versus the same period last year. Even though operating income was lower, it still made $4.9bn for the quarter, quite a staggering amount.

With the scope of diversification in business operations and recent acquisitions, I think Amazon is well-placed for the future. Clearly, one risk is that Amazon grows to such a size with so many fingers in pies that it becomes less focused and efficient.

Dividend stars

With a lot of focus on the top US stocks posting share price gains, I could easily forget about some great income picks. For example, Exxon Mobil (NYSE:XOM). It has a dividend yield of 5.8%, with a share price gain of 46% over one year.

The oil and gas company is one of the largest in the sector and has a rich history over decades since the merger of Exxon and Mobil in 1999. This gives me confidence the business will continue to function in years to come, even during tough times. 

One risk is the projection for oil prices for 2022. If we do see tighter restrictions on travel, then fuel demand will fall. If supply stays the same, this will lower the oil price and negatively impact Exxon Mobil.

Another top US stock that pays dividends is Western Union. The dividend yield for one of the world’s largest international payment businesses is 5.3%. The share price is down 17% over the past year, which is one reason why the yield has moved higher.

The share price has fallen due to decreasing offline money transfers due to the pandemic. If restrictions on travel continue, this could be a risk with investing. However, the company is able to offset some of this via growth in digital payments instead. Further, as travel picks up again, the business should naturally see a rebound.

Allocating the cash

These three top US stocks are viable options for me to consider as a UK investor. With my £1,000, I’d split it equally between the them. However, I could also invest more in a particular stock if I had a high conviction. I think Western Union is the most undervalued stock of the trio, so could put more than 33% of my money in the stock.

Overall, they’re my top pics as we head into 2022.

Jon Smith has no position in any share mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool UK has recommended Amazon. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The NIO (NYSE: NIO) share price has been on a downward spiral for almost all of 2021. Peaking at $63 in January, the shares have fallen almost 55%. Much of this action has been in the past 30 days, where the shares have fallen 29%.

So, what’s going on?

In a nutshell, NIO has found itself in the middle of a few big problems. 

No surprise, the first is the pandemic and the effect it has had on vehicle production and delivery. This has been an ongoing theme for the Chinese electric vehicle (EV) manufacturer. Between April and March this year, the firm had to halt production of its vehicles, which translated to a $60m loss. More recently, supply chain issues caused a 65% reduction in month-on-month car deliveries for October. What worries me here is the new threat of the Omicron variant. NIO cannot afford to fall behind in an ever increasingly competitive EV landscape.

This brings me to my second concern for the company – competition. The EV landscape has heated up over the past few years, and this trajectory is only expected to continue. Analysts at Bank of America have predicted that EV IPOs could raise $100bn by 2023. Whilst NIO is facing competition from up and comers, its also competing with some of the most established automakers in the industry. For example, Ford and General Motors have set aside a combined $38bn dollars for EV R&D.

The third main problem driving down the NIO share price is the looming threat of inflation. Inflation erodes the value of future earnings. This heavily weighs down on high-growth stocks such as NIO, which often rely on bullish forward earnings figures to entice investors. Rising inflation is usually remedied by central banks increasing interest rates. If this is the case, it can magnify company debts, of which NIO has just under $3bn.

Why the NIO share price could rise

Although the NIO share price has been falling, the firm is still growing at an astounding rate. As my fellow Fool Stuart Blair points out, 2021 Q3 deliveries rose 100% year-on-year at 24,439. Not many companies can boast stats like that.

What’s more, on December 18 NIO announced it was releasing a new ET5 sedan model. Due to start deliveries in September 2022, NIO has partnered with Chinese start-up Nreal to provide new augmented reality glasses for the car. I like the fact that the firm is embracing new cutting-edge technology, and I think moving forward this will be critical to set NIO aside from its competition.

Would I buy?

In fact, I have been a holder of NIO shares for some time now. Having covered the stock many times over the past year, I have often reached a bullish conclusion. The stock is currently trading at an encouraging price to sales ratio of 10. This does look cheap to me, especially considering the firm’s high growth. However, at present, it seems that the various problems NIO is battling are getting the better of the share price. I think NIO could have further to fall and, as such, I will wait before adding any more shares to my portfolio for the time being.

Dylan Hood owns shares of NIO. Bank of America is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The THG (LSE: THG) share price has had a torrid few months, and at one point had crashed by over 75%. However, in December the stock has surged by a huge 38% as I write today. While it’s still over 70% down on its January debut price, this recent resurgence has prompted me to reassess the investment case here.

Is the market repricing the growth opportunities on offer at THG? Let’s take a closer look to see if the stock is a buy for my portfolio.

The bull case

As a quick recap, THG is an online retailer of its own and third-party brands. The company also provides an end-to-end e-commerce solution for consumer brand owners under its THG Ingenuity division.

THG Ingenuity is crucial for the company’s future growth prospects in my view. In fact, Japanese conglomerate Softbank entered a collaborative agreement with THG in May that saw it invest $730m in the shares. What’s more, Softbank has an option to acquire a 19.9% stake in THG Ingenuity for $1.6bn, provided it’s separated from the main group into a THG-owned subsidiary. There’s also potential to leverage Softbank’s connections across its portfolio companies to grow Ingenuity further.

The most recent interim results to 30 June showed impressive year-on-year revenue growth of 41.9%. In particular, THG Ingenuity revenue grew by 39.7%, which is important given the prospect of the Softbank deal. City analysts also expect group revenue to increase by 26% in 2022, which is still strong growth.

The bear case

There have been governance risks with THG in the past that I wrote about here. I’d have to be comfortable with these issues before buying any shares.

But it’s the cash flow that I’m concerned about today. The company is highly acquisitive, and also has major capital expenditure (capex). THG had capex of £239m during 2020, with a further £112m spent on acquiring businesses. There have been a further eight acquisitions in the six months ending June 2021. This suggests to me that THG is a capital-intensive business. As the company remains loss-making, it’s had to raise capital from debt and equity issuance to pay for these investments. There’s a high chance of further share and debt issuances going forward, which heightens the risk for shareholders.

It’s hard for me to understand the potential with THG Ingenuity because the company doesn’t separate out its profit margins and cash flow from the other divisions. It may be that it’ll be a capital-light and highly cash-generative business in the future. But today, I can’t determine if this will definitely be the case.

Is THG stock a buy?

With so much riding on the success of THG Ingenuity, I’d have to be confident of its success. It clearly has potential given the interest from Softbank. If it does take up the option to acquire the 19.9% stake in Ingenuity, I see considerably upside in the THG share price from here.

But THG doesn’t fit my preferred mould for a growth share. I like to see a capital-light company that can reinvest in the business with its own generated profits. Right now, THG requires considerable external capital to grow, which means I won’t be buying the shares today.

Dan Appleby has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The National Grid (LSE: NG) share price is one of the most defensive investments in the UK. However, its competitive advantage does not protect it from regulators and politicians. These challenges could have a significant impact on the investment’s performance if the company cannot change with the times. 

The outlook for the National Grid share price

Whenever I have covered the company in the past, I have always noted that National Grid has a substantial competitive advantage. It owns and operates the majority of the electricity infrastructure in England. It also has a large US business, which makes up around 50% of total assets. 

Building electricity infrastructure is incredibly costly. Most of the assets owned by the group have been in place for decades. Rebuilding this network would cost hundreds of billions of pounds. And it is unlikely any competitor would gain the planning permission required to develop a network as National Grid has done. 

This suggests it is unlikely the company will face any competition in its home market. Unfortunately, the business is also highly regulated. Regulators effectively control how much it can charge consumers and how much it can invest. 

Regulators are now starting to clamp down on companies like National Grid. They want these utilities to invest more and charge consumers less. This suggests National Grid has a challenging outlook. It needs to balance the requirements of regulators with shareholder returns. 

Luckily, the company’s international diversification provides some flexibility. However, the US market is also highly regulated and far more competitive. So I cannot take anything for granted. 

Despite these challenges, the National Grid share price looks to me to be an attractive investment for an inflationary environment. The company can increase prices in line with inflation. This suggests it can also increase its dividend to investors in line with inflation. Many other organisations do not have this appealing quality. 

Top-performing investment

Due to its defensive nature, investors have been clamouring to buy the stock over the past year. Since the beginning of 2021, the National Grid share price has returned nearly 25%, excluding dividends. 

Considering the company’s challenges, I think it is unlikely the stock will repeat this performance next year. Its 4.7% dividend yield looks attractive, but regulatory headwinds could force the group to cut this payout. Although nothing is set in stone, I think it is sensible to take a look at all risks. 

The group’s profits could also come under pressure if it needs to invest more in either the UK or US market.

Therefore, I would not buy the stock for my portfolio today. I think the company faces a number of challenges, which mitigate its attractive qualities. In my opinion, there are other businesses on the market which offer a similarly attractive package with less regulatory risk. 

Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

I’m searching for the best cheap dividend stocks to buy for my shares portfolio. Here are three income heroes on my watchlist right now.

Looking good

I think Lookers (LSE: LOOK) could be a great buy for 2022 and long beyond as sales of electric vehicles (EVs) in the UK rocket. Growing environmental concerns are seeing drivers ditch their pure-petrol vehicles in massive numbers for battery- and hybrid-powered autos. This bodes well for car retailers like this UK share. The Society of Motor Manufacturers and Traders believe 260,000 pure battery-powered cars will roll out of UK showrooms next year alone.

That said, driver appetite for these new-age vehicles could disappoint if government investment in related infrastructure fails to take off. Indeed, concerns are rising that the Department for Transport is watering down plans for the widescale deployment of EV charging points announced earlier this year.

Still, I think this risk could be baked into Lookers’ share price today. The retailer trades on a P/E ratio of just 6.8 times for 2022. This, combined with a chubby 3.8% dividend yield, makes it an attractive buy, in my book.

8.5% dividend yields

I’m confident that Britain’s housebuilders will enjoy another strong year in 2022. It’s why I’m considering buying Persimmon (LSE: PSN) shares for my portfolio today.

This FTSE 100 dividend stock carries a mighty 8.5% dividend yield for next year. It offers plenty of bang for my buck from an earnings perspective too, with the builder trading on a P/E ratio of just 10.8 times. It’s a reading that reflects the possibility that soaring construction costs might hit profits hard in 2022.

I think the likes of Persimmon will continue to witness robust demand for their new-build homes in the new year. This makes the housebuilding sector an attractive investment destination, in my eyes.

Low interest rates and the government’s Help to Buy scheme will continue to support first-time buyers. And intensifying competition among Britain’s lenders is helping buyer affordability too. Habito’s latest product announced this week allows customers to borrow seven times their salary.

Another dividend hero on my shopping list

Copper miner Central Asia Mining’s (LSE: CAML) another dividend share I’m looking at right now. It’s true that demand for its metal might sink if China’s real estate sector nosedives and pulls the country’s economy with it. But, as a long-term investor, I believe the pros of owning this share could outweigh the cons.

I’m not just a fan because I think rising investment in green technologies like EVs and wind turbines will supercharge copper demand over the next couple of decades. I also expect red metal consumption to increase as infrastructure spending across the world steadily increases.

I don’t think Central Asia Mining’s rock-bottom valuation reflects these positives. The business trades on a P/E ratio of just 6.9 times for 2022 at current prices. This, combined with a jumbo 6.6% dividend yield, provides plenty of value, in my opinion.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.