2013 was a year of record growth and profits for the global stock market, but will this momentum continue in 2014? Because of several big events such as new legislation and regulations, product releases and encouraging forecast numbers of the general economy, analysts have been pinpointing certain key sectors for prominent performance. Whether you’re an experienced investor or a novice investor with only 3 stocks so far (Apple, Google, Facebook – duh!), one good strategy to always employ is diversifying your portfolio. We bring you three sectors to look out for in 2014 that may help you to do just that.

1. Health HealthCare, Biotechnology

The Affordable Care Act (ACA), better known as Obamacare, is a health insurance regulation that was passed by the U.S. federal government last year. Essentially, more and more Americans are now required to be medically insured. If they can’t afford to, then employers must bear the burden. What does this mean for the healthcare industry? Publicly traded healthcare companies, drugstores, pharmaceutical firms and biotechnology enterprises are benefiting from this demand. Obamacare is boosting private and public spending on the industry, with Medicaid and Medicare Advantage the main drivers. Healthcare companies that provide medical insurance products like Aetna (NYSE:AET) and Cigna (NYSE:CI) are doing extremely well. Drugstores like CVS (NYSE:CVS), Walgreens (NYSE:WAG) or Express Scripts (FRA:4XS), in particular, are being widely recommended by analysts, who predict that they are likely to expand business. As Obamacare forces more people to get insured, demand for prescription medication from drugstores is expected to be driven up as well. For pharmaceutical companies, BigPharma is still a relatively safe and stable investment, with companies like Pfizer (NYSE:PFE) and Bristol Myers-Squibb (NYSE:BMY), which was recently endorsed by Morgan Stanley, are still being considered undervalued at some level and harbouring potential for a lot more growth. However, if you’re looking into more rapid growth, consider smaller pharma and biotech companies that are gaining grounds in medical research. Epizyme (NASDAQ:EPZM), a small cap pharma stock, recently saw an almost 80% price gain after its announcement of royalty payments from two separate drugs that reached milestones in their development. Salix Pharmaceuticals (NASDAQ:SLXP) has also recently acquired Santarus (previously NASDAQ:SNTS), who was poised for a wealthy 2014, with a line of new drugs queued up and ready for dispatch. 2014 is set to see equal, if not more, biotech IPOs, so be on the watch for new and upcoming companies. However, be mindful that the biotech industry is relatively more price volatile than the other industries, so make sure to do your research!

2. Home Building

The American economy has been rebounding strongly over the past few years, and none more so than the housing market that crashed so spectacularly in 2008. In 2013 the market took a slight dip, citing increased interest rates, but analysts over at The Motley Fool are confident in its rebound and continued traction into 2014. A “tight supply and an improving jobs picture are boosting sales”, especially in fast growth areas of the U.S., such as Texas. New regulations such as collateral requirements with loans also provide the market with a base safety net that was absent before. In order to meet this growing demand, analysts are recommending hedging your bets on the top home building companies to get the job done. D. R. Horton Inc (NYSE:DHI) is number one on Deutsche Bank’s top homebuilding stocks for 2014. It has held steady annual growth, plowing its way through the bad aftertaste of the recession. NASDAQ’s community position remains bullish on this stock. Lennar Corporation (NYSE:LEN), a mid-tier builder that remains promising, has also predicted that limited land, strong demand and short supply will continue to boost the market’s prospects into the spring buying season. Toll Brothers Inc. (NYSE:TOL) is a luxury home builder that has been moving into the urban markets via high-rise condominiums, on top of its regular sales. Though its earnings growth has tapered off a little into 2014, analysts are still keeping an eye on it. Home Depot (NYSE:HD) was also singled out by financial contributors at Forbes. It’s expected to gain a nice boost from excited, new homeowners and the housing recovery. Wall Street analysts on NASDAQ are bullish on Home Depot, with prices heading towards the $100 mark.

3. Media

The showbiz industry has always been big, and is set to have an even bigger 2014. Media is becoming bigger and bigger as consumers worldwide continue to gobble up entertainment with no end in sight. Even though no one can really predict what content becomes a hit, there are some stocks that one could look out for. Netflix (NASDAQ:NFLX) would be one such company, which closed out 2013 as the single highest performing stock of the S&P 500, with a 316.5% gain on the last Friday of 2013. Strong domestic and international subscriptions keep its outlook strong. Their line of original content has been well received, most notably their TV series, ‘Orange is the New Black’, as well as collaborations with Disney’s Marvel Entertainment has a line of promising projects out in 2015 that could up the optimism through 2014. Netflix also has a Zacks rank #1 of ‘Strong Buy’. CBS (NYSE:CBS), Time Warner (NYSE:TWX) and Viacom (NASDAQ:VIA) are also on Deutsche Bank’s list of big stocks to own in 2014. Time Warner’s slew of DC Comics films slated in the coming years might be a good investment. Disney (NYSE:DIS)is another widely recommended showbiz stock for 2014, showing up on recommendations from Deutsche Bank, Seeking Alpha, The Motley Fool, Yahoo Finance, Growing Stock Report and an upgrade from Guggenheim. Fuelled by the success of Frozen to close out 2013 up almost 50.6%, the Walt Disney Company has a few things going for it in 2015 that could sustain good sentiments through 2014. The acquisition of Lucasfilm and Marvel Studios brings in new revenue streams for them, while the anticipation of 2015’s blockbusters – the new Star Wars series and the Avengers sequel – might keep investors enthusiastic and prices buoyant. Moreover, Disney’s Shanghai theme park is slated to open its doors in 2015 as well. So there you have it! Three sectors that analysts seem to recommend for 2014. If you’re afraid to invest in any single stock, niche exchange-traded fund (ETF) that give you exposure to the whole sector is another route you could consider. Check out these pharma ETFs, home-building ETFs and media ETFs for more options. Will you be adding stocks from these to your portfolio in 2014? Add these stocks to your Watchlist in TradeHero so you don’t miss out on any of the action! Image credit: Trading Academy