The easy way is to head for the bookies. Ladbroke's is offering 2 to 7 on a Labour victory. A stake of pounds 700 now would return pounds 900 if Labour wins. But there is betting tax, so in fact you have to stake pounds 763 to receive pounds 900, a return of less than 18 per cent . Moreover, you may have to wait until May 1997 to collect your winnings and, of course, you could lose.
The difficult but potentially more rewarding way is to invest in companies and sectors that might benefit from a period of Labour rule. And to avoid companies and sectors likely to be disadvantaged by Tony Blair in Number Ten.
Of course there are some who argue that a Labour victory would be disastrous for all shares, leading to a blow-out in government borrowings, higher taxes, a return to high inflation and the emergence of an anti-business culture. In fact, historically, the stock market has done well under Labour administrations. And Mr Blair and his front-bench colleagues have managed to calm the worst of City fears.
Analysts at the regional stockbroker Charles Stanley have identified several categories of potential winners from a Labour victory. The first category is companies with large overseas earnings. A weakening of the pound or a fully fledged sterling crisis would increase the value of repatriated earnings.
Most FT-SE 100 companies have some foreign earnings but the groups with the biggest proportionate overseas profits are BAT Industries, Redland, Carlton, RTZ, Glaxo Wellcome, Cable & Wireless, Shell, Hanson, GEC, Unilever, SmithKline Beecham, Grand Metropolitan and Tate & Lyle.
Labour's front bench remains vague about its precise policies, but it certainly believes in boosting transport infrastructure projects, in particular the rail network. There could also be a boost to the school- and hospital- building programme. If one sector stands out as a beneficiary, it is the bombed-out building and construction industry.
Among possible building winners picked by Charles Stanley are Hewden Stuart, Rugby Group, Alfred McAlpine, RMC, BICC, Y J Lovell, Taylor Woodrow, John Laing and Wimpey.
A third category of Labour-benefiting companies is waste management and recycling. Labour has a wide-ranging commitment to green issues. Measures are expected to force heavy industry to stricter standards on the removal and recycling of waste. The potential beneficiaries? Wessex Water, Caird Group, Shanks & McEwan, Waste Recycling Group and Leigh Interests.
The most glaring potential losers from a Labour victory are the public utilities. The fat-cat scandals have ensured that Labour could slap windfall- profits taxes on most of them without the slightest public opposition. The electricity companies are most threatened, followed by the water utilities.
Another obvious candidate for a windfall tax - or at least a tightening in its regulatory regime - is the National Lottery, which is run by the Camelot consortium. Its quoted shareholders are Racal, Cadbury Schweppes, De La Rue and ICL.
Labour will be desperately seeking areas to cut spending if it is to meet its election promises for increased spending in other areas such as education. The obvious department for the spending axe is defence. Losers here would be GEC, British Aerospace, Vickers, Huntings, Westland, Racal, Smiths Industries and Vosper Thorneycroft.
Another species of business that could find life tougher under Labour is the merchant banks. Labour has made it plain it wants to crack down on hostile takeover bids - the juiciest of fee earners for the merchant banks - perhaps forcing bidding companies to show their bids are in the public interest. Merchant banks still independent and quoted include Schroders, Cater Allen, Close Brothers, Hambros and Singer & Friedlander.
The spectre of a statutory minimum wage hangs over British business. Labour is committed to introducing one, though it refuses to say at what level. The biggest casualties would almost certainly be pubs, catering, hotels and restaurants, which helps explain the brewers' generous support for the Conservative Party.
One final vulnerable grouping is high-yielding stocks. Some of the Labour front bench is alarmed by the fashion for companies to pay out bumper dividends instead of re-investing profits in wealth creation for the future. The tax treatment of such pay-outs could change.
In the next year the Blair factor will be something to consider whatever share you invest in.Reuse content