Penny stocks are companies with a share price under 100p and (usually) a market capitalisation under £100m. I’ve been hunting through these small companies looking for growth stocks to buy for my Stocks and Shares ISA in 2022.

Here are three I’ve found that I’d buy for my portfolio today.

Under-the-radar growth

My first pick is currency exchange specialist Argentex (LSE: AGFX). This £100m business is one of a handful of companies that’s disrupting the currency services offered by banks by providing cheaper and faster services.

Argentex doesn’t serve the holiday travel market. Instead, the firm targets higher-value customers with more sophisticated requirements, such as institutions, companies, and high net worth individuals.

This is still quite a small business, but growth has been strong so far. Revenue rose by 33% to £15.7m during the six months to 30 September, while pre-tax profit jumped 22% to £3.3m. The main risk I can see is that this is an increasingly competitive market. Argentex’s profit margins have fallen over the last 18 months, cancelling out some of its growth.

However, I think the risk of slowing growth is already priced into the stock. Argentex shares are trading on just 12 times 2022 forecast earnings and offer a 2.5% yield. This is a growth stock I’d be happy to buy for 2022.

This turnaround is delivering results

My next pick is industrial chain specialist Renold (LSE: RNO). Unlike Argentex, this British firm is more than 100 years old. Renold makes chains and related parts used for machinery such as cement mixers, conveyor belts, escalators, and train doors. It’s one of the oldest companies in this market. Renold’s products sell all over the world.

This business has been through a difficult patch over the last few years, but now seems to be back on track. The company’s adjusted earnings are expected to rise by a chunky 79% this year, as the turnaround kicks in.

If Renold delivers on this forecast, I think the stock looks quite cheap on just nine times forecast earnings. My only serious concern is that this business still has a sizeable £100m pension deficit. This requires cash contributions of around £5.5m each year.

I’d want to keep an eye on the pension situation. But Renold is certainly a penny stock I’d be happy to own.

Too cheap to ignore?

The last share I’m going to look at is currently priced at just four times 2022 forecast earnings. The shares are also expected to provide a chunky 6.7% dividend yield in 2022.

The company concerned is Smiths News (LSE: SNWS), which delivers newspapers and magazines to shops all over the UK. The company has a 55% share of the market and has been in business over 200 years.

I’m sure you’ve spotted the obvious risk here — sales of printed newspapers and magazines have been falling for years as readers move online. My guess is that this trend will continue.

This decline is an ongoing challenge for Smiths, but the company’s big market share means that it still handles enough volume to make money. Cash generation is good, and Smiths’ debt levels have been falling fast.

I think this penny stock is probably too cheap at current levels. For this reason, I’d be happy to add Smiths News to my portfolio today.

Roland Head 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.

Buying into actively-managed investment funds can be a great way to build wealth over the long run. With these investments  your funds are pooled together with the money from other investors and then spread over many different stocks by a professional manager. The end result is diversified exposure to the stock market at a relatively low cost.

Here, I’m going to highlight nine top funds I like for 2022 and beyond. All of these products have good performance track records so I’d be comfortable buying them for my own investment portfolio today. 

My top UK equity funds for 2022  

Starting with UK-focused products, one of my top picks is Royal London Sustainable Leaders. This fund has an ethical focus (it aims to invest in companies making a positive contribution to society) and I see it as a great ‘core holding’. At the end of October, top holdings included Prudential, Experian, and Astrazeneca. 

In terms of performance, this fund delivered a return of 12.1% per year for the five years to the end of October. By contrast, the FTSE All-Share index returned 4.6% per year over that period. This shows that long-term investors like myself can invest responsibly without having to sacrifice financial returns. 

In the UK growth fund space, I like Slater Growth. This is run by Mark Slater, who is considered to be one of the UK’s top stock pickers. Slater’s aim is to invest in shares which he believes are undervalued and that have the potential for a significant rerating.

At the end of November, top holdings included Future, Prudential, and Next Fifteen. Zooming in on performance, the long-term returns here have been excellent. Over the five years to the end of November, the fund delivered a return of around 106%. 

In the UK small-cap space I like ASI Smaller Companies. This fund aims to generate long-term growth by employing a strategy that combines growth, quality, and momentum approaches to investing. At the end of last month, top holdings included Kainos, Gamma Communications, and Impax Asset Management. Over the five years to the end of November, it returned about 16.5% per year after fees, which was well ahead of its benchmark. 

Finally, in the UK equity income space, I like the TB Evenlode Income fund. This is an income-focused fund that predominantly invests in high-quality UK businesses (it’s allowed to invest a small proportion of its capital internationally). Top holdings at the end of November included Unilever, Diageo, and Sage. Over the five-year period to the end of November, it returned 55%, which is very good for an equity income fund. In terms of income, the dividend yield here is currently about 2.4%. 

Global equity funds for 2022 

Moving on to global equity funds, one of my top picks for 2022 is Fundsmith. This fund, which is managed by Terry Smith, is one of the most popular equity funds in the UK, and it’s not hard to see why. Since its launch in late 2010, it has delivered a return of about 18% per year, which is phenomenal. 

What I like about Fundsmith is that Smith has a very simple approach to investing. All he does is pick great companies and hold them for the long run. It’s a straightforward, Warren Buffett-like approach to investing that works. At 30 November, top holdings included Microsoft, Intuit, and Estée Lauder. 

Another global equity fund I hold in high regard is Blue Whale Growth. This is a concentrated growth-focused fund run by Stephen Yiu. This product was only launched in 2017 so it doesn’t have the kind of long-term track record that Fundsmith has. However, since its launch, it has delivered very strong returns (20.8% per year to the end of November), outperforming most funds in its category. 

Like Smith, Yiu has a straightforward approach to investing. He simply invests in high-quality growth companies that are trading at attractive valuations. Looking at the performance here, this approach certainly seems to work for the portfolio manager. At the end of November, top holdings included Microsoft, Alphabet, and Adobe. 

US equities 

Turning to the US, which has been a popular destination for UK investors’ capital in recent years, I like Baillie Gifford American. This is a growth-focused product with an excellent performance track record. Over the five years to the end of November, it generated a return of 34% per year. Top holdings at the end last month included Shopify, Tesla, and Moderna. 

Technology funds for 2022 

Finally, I think it’s worth highlighting some top technology funds. After all, we are in the midst of a tech revolution.

For a core technology holding, I like Fidelity Global Technology. This is a fairly vanilla tech fund that contains exposure to a lot of the big tech names including Microsoft, Apple, and Amazon. Performance here recently has been solid. Over the last five years, it has returned about 27% per year. 

For a more niche technology play, I like Sanlam Artificial Intelligence. This is focused on companies that are active in the artificial intelligence (AI) space. At the end of October, top holdings included Alphabet, Upstart, and Keyence. It’s worth pointing out that this fund was only launched in 2017, so it doesn’t have a long-term track record. However, performance since inception has been very strong (28% per year to the end of October). 

The risks of investing in funds

It’s worth pointing out that all of these funds have their own unique risks. For example, the UK funds could underperform if the country’s economy struggles.

Similarly, the tech funds could underperform if these stocks fall out of favour. Some of the funds, such as Fundsmith and Blue Whale, are also quite concentrated in nature, meaning they have a higher level of stock-specific risk relative to more diversified funds. As always, past performance is not an indicator of future returns.

I’m comfortable with these risks however. I think all of these funds could play a valuable role in my diversified portfolio in 2022.

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. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Edward Sheldon owns Alphabet (C shares), Amazon, Apple, Hargreaves Lansdown, Diageo, Experian, Gamma Communications, Kainos, Microsoft, Prudential, Sage Group, Shopify, Unilever, and Upstart Holdings, Inc and has positions in Fundsmith Equity, Blue Whale, and Samlam Artificial Intelligence. The Motley Fool UK has recommended Alphabet (A shares), Amazon, Apple, Diageo, Experian, Gamma Communications, Kainos, Hargreaves Lansdown, Microsoft, Next Fifteen Communications, Prudential, Sage Group, Shopify, Unilever, and Upstart Holdings, Inc. 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.

This can be an expensive time of year. But for some people it also brings Christmas money as a gift. Rather than fritter it away, I think it’s possible to use such Christmas money to start investing. Here’s how I would do that with £300.

The benefit of investing

Why would I bother investing? After all, I could use the money to splash out on a treat for myself.

That’s true, but the reason I would consider using such money to invest is to help it go further. If I spent it all now on something I wanted, the money would be gone for good. But if I put it to work in the stock market, it could turn out to be the gift that keeps giving. Whether through dividend income or growth in share value, my £300 today could turn into a bigger sum in the years to come.

How I’d invest £300

The simplest way for me to invest £300 would be to put it into an index tracker fund. These are shares in a fund that invests to mirror a leading index. An example of such an index is the FTSE 100. Such a fund should offer broad exposure to companies in a range of business sectors. It would also give me some diversification. Diversification matters because it helps me reduce my risk if an individual company performs poorly. With £300 it can be hard to diversify by buying individual shares. An index fund offers me the benefit of diversification thanks to its investment in a variety of different companies.

Such an approach is fairly simple and requires me to do little. I could simply invest my £300, sit back, and wait to see how my shares perform over time.

Could I start investing actively?

A lot of people struggle just to sit still, though. Instead of buying a tracker fund, I could invest in individual companies.

That typically incurs fees. My £300 could soon be eaten up by fees if I buy lots of shares in different firms. So I would choose a couple of different ones. That at least gives me a little bit of diversification, while keeping the impact of trading fees on my £300 stake relatively low.

It’s not as easy as many people think to choose shares that go on to perform well. So while I might set up a trading account and deposit my £300 immediately, I wouldn’t be in a rush to use it to buy shares. Instead, I would do some research. First I’d clarify my investment objectives. Should I focus on income, share price growth, or a combination of both?

Having done that, next I would start looking for individual shares that might meet my criteria. For example, a company like Imperial Brands could offer me a high dividend but the growth prospects for its tobacco business look limited. There could be plenty of growth at food delivery company Deliveroo – but I wouldn’t expect it to pay dividends any time soon.

Each share carries its own risks, so I would take time to research the pros and cons of any given share. Only once I had done some research and found some shares that seemed to meet my own investment priorities would I start to put my £300 of Christmas money to work.

Christopher Ruane owns shares in Imperial Brands. The Motley Fool UK has recommended Deliveroo Holdings Plc and Imperial Brands. 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 this article, I reveal four quality FTSE 250 dividend stocks I’d buy for 2022 and beyond.

Bank on it

TBC Bank Group’s 6.5% dividend yield for 2022 makes it a highly attractive dividend share to me. Compare that monster figure to the broader 2% average for FTSE 250 shares. I also like the bank’s rock-bottom forward P/E ratio of 4.7 times. I’d happily buy it based on these numbers.

Like most UK shares, TBC Bank is in danger of suffering next year if the Covid-19 crisis keeps worsening and the economic recovery falters. But I believe this danger is baked into the company’s low valuation. I’d buy this dividend stock because its key Georgian marketplace looks set for further exceptional long-term economic growth when the pandemic subsides.

Serious air time

Booming emerging market wealth levels also bode well for Airtel Africa (LSE: AAF), a major telecoms provider in sub-Saharan countries. Demand for its voice and data services is growing at a stratospheric rate and latest financials showed these revenues jump around 17% and 34% respectively in the six months to September.

I also like the efforts Airtel Africa is making to exploit the fast-growing mobile money segment. In November, it expanded its Airtel Mobile Commerce unit into Nigeria and, last week, Middle Eastern investment firm Chimera Investments ploughed $50m into Airtel’s money business to help it grow.

Today, Airtel Africa carries a meaty 4.8% dividend yield too. I think it’s a top stock for me to buy despite the growing level of competition in its territories.

Riding the building boom

It’s possible demand for Ibstock’s bricks could slump if a shortage of other building products hits residential construction rates. Still, it’s my opinion that the potential rewards on offer from this FTSE 250 stock outweigh the risks. I’m expecting this share to continue thriving as low interest rates, intense competition among home loan providers, and ongoing support from government through Help to Buy keep demand for newbuild homes rising.

This is why I already own Ibstock in my own shares portfolio. And at current prices I’m thinking of adding to my holdings. Today, this FTSE 250 stock trades on P/E ratio of 11.7 times for 2022. It also sports a chunky 4.2% dividend yield.

Boxing clever

I’m also expecting Tritax EuroBox to have a big year as the relentless march of e-commerce continues. It could also receive a boost from the worsening health crisis as people either choose to, or are forced to, do their shopping online. This FTSE 250 share provides ‘big box’ properties in Europe that retailers and product manufacturers use to get their wares out to customers.

Tritax Eurobox is expanding rapidly to capitalise on the online retail boom too. In the 12 months to September, it added assets in Germany, Italy, Belgium and Sweden to its portfolio. I’d buy this UK property share even though a shortage of decent acquisition targets could hit profits growth. Today, the business carries a 3.8% dividend yield.

Royston Wild owns Ibstock. The Motley Fool UK has recommended Airtel Africa Plc and Ibstock. 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 believe that one of the best ways to invest in the stock market is with investment funds.

Some investors may avoid investment funds because they prefer to choose investments themselves. That is a perfectly acceptable approach. However, I believe there will always be a place for investment funds in my portfolio. 

I hold this view because investment funds can help me build exposure to sectors or industries I may not understand.

Managers may also be more comfortable investing in certain companies than I am. I know in the past I have been too cautious when selecting potential investments, which has had an impact on my performance. By building exposure to different funds and fund managers, I think I can work my way around this drawback. 

With that in mind, here are three investment funds that I would buy for my portfolio in 2022. I have picked these funds because I believe they can bring something different to my portfolio. 

Investment funds for growth

The first fund I would buy is the Liontrust UK Growth fund. The fund’s managers concentrate on finding companies with a significant competitive advantage. This can be anything from intellectual property to businesses that have a high level of recurring revenue. 

The top holding in the portfolio today is AstraZeneca, one of the UK’s premier pharmaceutical companies. The annual management charge is 0.87%, and over the past year, the fund has returned 17%.

As a UK growth fund, all of the assets are invested in UK equities. This could be a drawback if the UK stock market underperforms the rest of the world in 2022. The lack of diversification is concerning, but as a way to invest in UK growth stocks, I think the fund has tremendous potential. 

A focus on small caps

Small-cap stocks can provide better returns for investors in the long run. This is primarily because smaller businesses can grow faster than their larger competitors, although additional risks come with investing in smaller companies. Many lack the checks and balances that are in place at larger enterprises. 

This is why I would buy a diversified small-cap fund such as the Marlborough UK Micro-Cap Growth fund. This fund has an excellent track record of finding small businesses. It is on the lookout for companies that have a edge in their respective markets, as well as a bright growth outlook. 

The largest holding in the portfolio today is S4 Capital, the rapidly expanding digital advertising agency. The annual management charge currently sits at 0.72%. 

International growth

The final investment fund I would buy for growth in 2022 is Jupiter Global Value Equity. Launched in 2018, this is a relatively new fund that focuses on companies around the world with low valuations. 

Just 24% of the portfolio is invested in the UK, making it a truly global fund. One of the most significant holdings is Nokia. It charges an annual management fee of 0.93% and can invest 30% of assets in non-equity instruments, giving the manager more flexibility when it comes to finding value. 

Unfortunately, the fund has lagged the market recently due to a lack of exposure to high growth stocks. This trend could continue if value equities remain out of favour. 

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.

Some of the best income shares on the market are oil stocks. However, these companies have a range of risks hanging over them, which could hit profits in the future. That is why I have been looking for the best renewable energy income shares to buy today for my portfolio. 

Some green energy stocks offer yields of up to 6%, proving that investors do not have to limit themselves when looking for income plays. 

With that in mind, here are my three top renewable energy income stocks to buy. 

Renewable energy income 

The first company on my list is Greencoat UK Wind (LSE: UKW). This is one of the UK’s oldest and most established green energy stocks. It owns a portfolio of wind generation assets across the country.

Its portfolio has grown steadily over the past couple of years through a combination of acquisitions and organic growth. The group recently raised £450m to fund new purchases, and it seems as if investors are more than happy to provide the new capital. 

At the time of writing, the stock supports a dividend yield of 5.2%. It also provides a level of inflation protection as contracts in the energy sector tend to be inflation-linked. 

These are the reasons I would buy the stock for my portfolio today. Challenges it could face going forward include higher interest rates and more competition for green energy assets. These headwinds could reduce returns on the wind portfolio and dividend growth. 

Utilities and infrastructure

The Ecofin Global Utilities and Infrastructure Trust  (LSE: EGL) currently supports a dividend yield of 4.2%. The investment trust also trades at a discount to its net asset value of 5%. 

This company owns a portfolio of utility and infrastructure businesses around the world. The top two holdings, which make up around 10% of assets under management, are NextEra Energy and Iberdrola. 

Iberdrola is rapidly becoming Europe’s largest renewable energy company, and NextEra is the world’s largest generator of renewable energy from the wind and sun. 

Considering these holdings, I think the company is one of the best renewable energy income shares to buy for my portfolio today.

However, the risk of using this approach is that I will have to pay the fund’s management fee of 1.5%. This could significantly impact returns in the long run if the company underperforms the broader market. 

Energy storage

The final company I would buy is the Gore Street Energy Storage Fund (LSE: GSF). 

This business is building a portfolio of energy storage assets across the UK. The goal of these is to help balance supply and demand across the electricity grid as the world transitions towards green energy. Renewable energy generation can be unpredictable, so there is a need to balance supply during periods of low wind, for example. 

Gore Street is one of the players chasing this market. The company can use its existing presence in the market to raise funding from investors. This is helping to support the expansion of its operations. With more growth ahead and a dividend yield of 6%, I think this is one of the best renewable energy shares to buy now. 

Challenges the company may face going forward include competition and higher interest rates. Both of these could become headwinds to growth. 

Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended Greencoat UK Wind. 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.

These cheap UK shares offer big dividend yields for 2022. Are they too good to miss or investor traps I should avoid?

Hammer to fall?

Shopping centres operator Hammerson (LSE: HMSO) offers mighty all-round value today. Its 4% dividend yield for 2022 is more than  double the FTSE 250 average. Meanwhile, City predictions of a 44% earnings rebound next year leave the company trading on a forward price-to-earnings growth (PEG) ratio of 0.4.

A reading below 1 suggests a stock could be undervalued. But even this low valuation isn’t enough to encourage me to invest today. Shoppers are deserting physical retail in their droves again as the Covid-19 crisis worsens. Springboard data shows footfall at Britain’s shopping malls down a whopping 32.9% on Sunday versus two years ago. Things are bound to get even stickier for Hammerson and its retail tenants if the government tightens coronavirus restrictions too.

Turnaround plans

On the positive side, Hammerson has been making considerable progress to bring its debt mountain down. It’s raised an extra £92m thanks to the sale of six assets since the halfway point of 2021, it announced last week. That said, the amount of debt the business continues to hold is colossal. And I worry that this could push it back to the brink if shoppers stay away from its retail destinations. Hammerson had net debt of £1.9bn as of June.

The company’s drive to focus on cities with strong economic and population growth may well deliver meaty profits growth over the long term. So could its decision to move away from pure retail and towards providing a more ‘social’ experience for visitors. But this isn’t something I’m prepared to take a chance with right now.

A 5.4% dividend yield I’d rather buy

I’d much rather spend my hard-earned cash on gold-mining stock Centamin (LSE: CEY). There are plenty of reasons why I think precious metals prices could soar in 2022. First and foremost is a prolonged period of high Covid-19 infections that might derail the economic recovery. Then there’s the global inflationary bubble that analysts are tipping to worsen before it gets better. China’s sharply-cooling economy and weakening property sector are other reasons why safe-haven assets like gold could gain momentum.

I’d prefer to buy a gold-mining share like Centamin rather than snap up physical metal or invest in a gold-backed financial product like an ETF. Okay, doing this exposes me to the unpredictable nature of metals mining where production issues can have significant consequences for a company’s bottom line. But I believe the possibility of big dividends can offset this problem.

And Centamin does offer huge income opportunities for 2022 and beyond. This FTSE 250 firm has a big 5.4% dividend yield for next year. It also offers decent value from an earnings perspective, the digger trading on a forward price-to-earnings (P/E) ratio of around 12 times. This is one of the big-dividend-paying UK shares I have my eye on today.

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.

If I had to invest a lump sum with a goal of generating £1,000 a month in passive income, I would not buy the market’s highest-yielding stocks. 

Some investors might think this approach sounds strange. Many market participants would buy the highest yielding stocks on the market to achieve the highest rate of return possible. I think this approach is misguided. 

Occasionally, high-yield stocks support a market-beating yield because the market does not believe the payout is sustainable. In my opinion, there is no point in buying a stock that yields 8%, for example, only for the company to cut the distribution next year. It is often the case that after a dividend cut, investors sell the shares, which can lead to significant capital losses. 

To put it another way, I think investors often end up chasing yield only to end up with capital losses. 

If I had to build a portfolio to generate £1,000 a month in passive income, I would acquire stocks with both low and high dividend yields. 

Passive income portfolio

The stock market currently supports an average dividend yield of around 3%. I think I can earn a bit more than this by acquiring a diverse portfolio of income stocks. 

My yield target is around 4%. Based on this target, I estimate I will need a nest egg of £300,000 to generate a passive income of £1,000 a month. 

I think this is possible even when combining lower yield assets, such as the drinks giant Diageo, which currently offers a dividend yield of around 2%, with higher yielding assets. I would be happy to acquire this consumer goods company for my portfolio.

When it comes to finding high yielding assets, I will focus on companies with sustainable dividend payouts. I will be looking for corporations that generate lots of cash and that can afford to return large amounts to investors. 

Two companies that I would buy are Direct Line and BHP. The former is one of the largest insurance organisations in the UK. The latter is the world’s largest miner. Both have unique competitive advantages and strong balance sheets. This means they can return significant amounts of cash to investors.

The stocks currently support a dividend yield of around 8%. However, as mentioned above, this dividend could be cut at a moment’s notice, so I will not be taking it for granted. 

Income and growth 

I would also acquire the self-storage group Big Yellow for my passive income portfolio. With a dividend yield of 2% at the time of writing, the company is hardly a dividend champion. Nevertheless, it has grown rapidly over the past decade, using profits from operations to expand its footprint.

As its footprint has expanded, the company has been able to increase its dividend to shareholders. These are the sort of qualities I am looking for in a sustainable dividend investment. 

Still, past performance should never be used as a guide to future potential. Just because the corporation has been able to grow earnings and its dividend in the past does not mean that it will continue to do so. 

When combined, the four companies outlined above could provide an average dividend yield for my portfolio of 5%. This is above my target, offering flexibility for the rest of the portfolio. 

Rupert Hargreaves owns Diageo and Direct Line Insurance. 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.

2021 has been a great year for owners of shares and other assets. Prices of stocks, real estate and cryptocurrencies have soared, vastly enriching investors. The only major asset class to fall this year is bonds. As inflation soared, bond prices slid. Thus, the global bond market is down almost 5% in 2021, its worst year since 1999. Meanwhile, the FTSE 100 index has gained 11.6% over 12 months, while the US S&P 500 has surged by 26.5%.

The FTSE 100’s year: 77 winners, 23 losers

A total of 100 stocks have been in the FTSE 100 for at least a year. Of these, 77 have risen in value, with gains ranging from 74.5% to 0.5% (excluding dividends). Therefore, only 23 Footsie shares lost value over 12 months, with losses ranging from 0.6% to 26.8%.

Of the 77 FTSE 100 winners over one year, 59 have recorded double-digit returns, gaining 10%+. Furthermore, 42 Footsie stocks have jumped by at least 20% since Christmas 2021. Even more impressively, 20 Footsie shares have leapt by at least 30% over one year. Finally, six super-stocks have soared by 50%+ over 12 months. Wow.

The Footsie’s six biggest winners

For the record, these are the FTSE 100’s six biggest winners since Christmas 2020. As you can see, each stock has leapt by at least 50% over one year, with gains ranging from 50.7% to 74.5%. The average rise across all six champion shares is a handsome 61.1%. That’s nearly 50 percentage points ahead of the wider index.

Most of the impressive gains in these share prices have been driven by underlying business improvements driving higher earnings. However, one FTSE 100 stock — aerospace manufacturer Meggitt — is the subject of a £6.3bn takeover offer by US rival Parker-Hannifin. As a result, Meggitt stock has exploded by 86.2% since it closed at 397p on 19 July.

Which superstar stock would I buy today?

I don’t own any of these six star shares today, but which would I buy for 2022? For me, Meggitt is out, because much of its future value is already baked into its current share price. Also, with Ashtead’s share price only 8.5% below its record high, this high-flying stock looks highly priced to me. Likewise, at over 33 times earnings, Glencore shares look fully priced to me. I’ll also reject Croda International due to its bumper price-to-earnings ratio (above 55). In addition, I’m not a big fan of commercial property right now, so Segro is a no-no for me.

Hence, the FTSE 100 high-flier I’d buy today is a ‘boring, old-fashioned’ business, Royal Mail. On Christmas Eve, Royal Mail shares closed at 507p, valuing the universal postal service provider below £5.1bn. Over the past 12 months, this stock’s price has ranged from a low of 298.3p on 21 December 2020 to a high of 589.62p on 7 June 2021. Currently, it trades 14% below its 52-week high.

Right now, this looks like a classic value stock to me. The shares trade on a lowly price-to-earnings ratio of 5.8 and an earnings yield of 17.2%. Also, they offer a cash dividend yield of 3.3% a year, slightly below the FTSE 100’s 4% yield. That said, Royal Mail has been a ‘value trap’ in the past, so I’m hoping that its parcel-delivery arm has had a bumper Christmas. If not, then I imagine this share might be rather volatile in early 2022!

Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has recommended Croda International. 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.