If you're happy to take risks, this could be a golden opportunity

FEAR was the emotion that, for many, epitomised 2009:

the apparent near-collapse of the banking system, the freezing of credit, the dive in asset values, the slide of sterling against both the euro and the US dollar, the spectacular failure of several long-established institutions (such as Woolworths and MFI), the meltdown and near bankruptcy of Iceland's economy. The spectres of 2008, fear and uncertainty, still stalked the land.

When the London stock market opened on the 2 January, 2009, the FTSE-100 index was 35 per cent below its October 2007 level, and it would fall a further 20 per cent before long. The Bank of England base rate was at 2 per cent, having been at 5.5 per cent just a year earlier, yet interest rates would have further to fall.

March saw the year's low point for the FTSE-100 (3,512 on 3 March) and the Bank of England's monetary policy committee (MPC) reduced interest rates to a historical low of just 0.5 per cent two days later. The MPC also announced that it would commence quantitative easing measures (effectively the printing of money), Alistair Darling having earlier authorised up to 150 billion of taxpayers' money to be used to buy assets (such as gilts and bonds) in an attempt to oil the wheels of UK plc, which at that time appeared to be in danger of grinding to a halt.

Darling also announced the April 2010 introduction of a 50 per cent rate of income tax on income in excess of 150,000, as well as a 60 per cent effective rate on income between 100,000 and 112,950 (due to the phased loss of income tax personal allowances). Higher-rate tax relief on pension contributions would be restricted for high earners and the scrappage scheme was launched as a fillip for the UK's ailing car industry.

Yet for all the doom and gloom, last year presented ample investment opportunities for those with an appropriately strong disposition. Anyone investing in a basket of UK shares in early March was sitting on a 50 per cent profit by mid-December. Even the average corporate bond fund provided total returns of around 15 per cent over that period. Amid all of the uncertainty (indeed, because of it) gold posted another lustrous performance, its price rising from $870 an ounce (544) to an all-time high above $1,200 (750) in early December.

But are there still opportunities for investors as 2010 unfolds? Economic recovery is likely to be slow and laboured, particularly in the UK, saddled as we are with massive levels of debt. While repeating the mantra that portfolios should be appropriately diversified across assets, both classes and geographies, my view is that the UK commercial property and emerging markets sectors will be the big winners.

UK commercial property fund prices have dropped by as much as 40 per cent from their 2007 highs. While the recovery in asset values may not be either imminent or steep (and indeed may have further to fall), investors are meantime being rewarded with attractive income yields of 7 per cent or more.

As confidence and consumer demand returns in the US and elsewhere, emerging markets will be the ultimate net beneficiaries. Chinese and Indian export markets will be revived, thus further fuelling the growth of their own domestic markets as they continue their transformation from peasant states to global superpowers.

This year promises to be a bumpy ride, but for those with an appetite for risk and a strong constitution, there are profits to be made.

• Paul Lothian is director of Verus Chartered Financial Planners in Dundee.