As Britain stares at a potential economic slowdown, the possibility of an Olympic dividend is a tantalising prospect. Picking shares that will benefit from the Games, however, throws up many hurdles.

Companies such as the structural steel contractor Severfield-Rowen and the London-focused electrical contractor T Clarke were off to a flying start when London secured the 2012 ticket, but their exposure will decline.

Choosing the right time to get out of “Olympic stocks” is likely to be critical. A balanced fantasy portfolio must therefore include these and the consumer companies that are late starters but which will gain as 2012 draws near.

Construction companies are some of the most obvious beneficiaries. The likes of Balfour Beatty, the UK's biggest contractor and the company that is building the £300 million aquatic centre, will pick up much of the construction work. However, some commentators believe it will do the work more for the prestige than for the profit margins, which are likely to be slim and have to be weighed up against potential reputational damage.

Security issues will also provide some of the biggest opportunities. The Games will need at least 5,000 security guards, but London's biggest provider, Mitie, has only 3,500 on its books.

Electronic surveillance, CCTV, X-ray machines and other security measures are most likely to be provided by a consortium of international groups. Expect BT to have a major communications role as well.

As the biggest airline at Heathrow and the official carrier for the Games, British Airways ought to benefit. Equally, Whitbread, is well placed to reap the dividends from an influx of tourists to its Costa Coffee and Premier Inns brands.

In the media field, there should be a general boost to advertising, although it is difficult to pick outright winners at this point. WPP is well placed to see an overall boost to its revenues. Compass, the contract caterer that has supplied past Olympics, will also bid.

There are few sports-related stocks on the London index and it is arguable whether JJB Sports will see any uplift. However, given the impact that the England football team's performances has on its shares, a larger than normal haul of British medals could give the sportswear retailer's sales a lift.

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