What a difference a year makes. We have emerged from double-dip recession to brighter economic uplands. It may not be time to party like it's 2007 all over again, but there is a feeling abroad that the good times are coming back for the UK economy. This positive vibe was encapsulated this week by Bank of England Governor Mark Carney's pronouncement that he didn't see a need to raise interest rates until unemployment has fallen to 7 per cent, pencilled in for 2016 according to many observers.
So steady growth, improving employment prospects and no interest rate hikes on the horizon could be music to the ears of growth-hungry investors, although savers will be less than cheered.
But should the better economic news mean that those who would normally trust their cash to a savings account reassess and look to dive into equities?
After all, these have seen substantial growth in the past three years with valuations knocking on the door of all-time highs.
"My feeling is that the risks are on the upside and that growth could turn out stronger than the Bank of England expects," says Tom Stevenson, investment director at Fidelity.
But some sectors will benefit more than others he adds: "The FTSE 100 is weighted towards defensive sectors like tobacco and energy that will not outperform if growth picks up."
The property market, buoyed by the Government's help-to-buy scheme and extra confidence on mortgages, following Mr Carney's 'forward guidance' on rates could also have a significant impact on growth: "Economic recovery is being driven by the housing market so housing-related sectors and consumer sectors that will benefit from increased confidence will do well," says Mr Stevenson. "I also think that commercial property will see a pick up."
Charles Galbraith, managing director of Sippdeal, the broker and investment platform, reckons: "At the forefront of improving UK fortunes is likely to be an upturn in housing – new-build and existing stock; but especially the latter as new homes deals are traditionally only some 10 per cent of total transactions. This points to house builders, but because they have already rocketed and with Help to Buy phase 2 starting in January 2014, the market's focus is more likely to be on transactions, which means estate agents could be something to consider."
In addition, Mr Galbraith tips the banking sector, which all but collapsed in 2008, to enjoy the proceeds of UK growth as bad debts fall away and new business accounts are opened.
But a growing UK economy doesn't necessarily mean bumper stock market returns. It is worth remembering that the past three years has seen good returns on the FTSE 100 while the wider UK economy has been bumping along the bottom. The simple truth is that there is at best a timelag and more likely a substantial disconnect between the UK economy and the wider performance of benchmark indicies such as the FTSE 100.
Patrick Connolly, certified financial planner with Chase de Vere explains: "If the UK economy is on the road to recovery this will be positive for the stock market, although it is important to recognise that overseas sales make up about 70 per cent of the revenue of FTSE 100 companies and so what is happening elsewhere in the world is also hugely important."
In short, the fortunes of the crucial US economy and the emerging leviathan of China are at least as important if not more so to the prospects of the FTSE 100 as is the avoidance of outside economic shocks such as a renewal of the eurozone debt crisis.
Therefore, riots on the streets of Athens maybe as critical an indicator to investors as the actual profits and losses of UK PLC.
What's more, Mr Connelly reckons that the FTSE 100 is currently a tale of two share types – the markedly overvalued and majorly undervalued.
The UK stock market is looking quite polarised, with good-quality companies that are making consistent profits in demand and looking quite expensive, while many companies in perceived riskier sectors have been largely ignored by investors and so could represent better value.
This is all sounds like a bit of a minefield for even sophisticated private investors, this is why much of the money going into the stock market is through unit and investment trust funds. In effect, these pool investor cash and invest in a basket of shares either picked by a fund management team or to replicate the ups and downs of a particular index such as the FTSE 100 or FTSE 250. Those favoured by Mr Connelly include Special Situation funds runs by Investec and BlackRock, both with a long track record of delivering outperformance in both a growing and contracting economy.
Juliet Schooling Latter, from Chelsea Financial, says that investors should now look at different funds than they did during the recession: "The UK economy has been so dire that the focus for the last few years has been on UK companies with large amounts of over-seas earnings.
"Now managers are starting to look at companies with more of a domestic focus as the fledgling recovery begins."
Ms Schooling Latter identifies Artemis UK Income fund as being well placed to take advantage of the economic upturn as well as the Marlborough Special Situations and Franklin UK Mid Cap funds.
However, investors looking to get exposure to the UK stock market at this time but unwilling to pay the high fees levied by fund management groups can buy an exchange-traded fund (ETF) through a stockbroker.
There are thousands of ETFs tracking all manner of investments – from the FTSE 100 to precious metals.