Where do people invest during turbulent economic times like these? For the most part, working adults seek out alternatives to the usual suspects of long-term holding of stocks, bank certificates of deposit (CDs), and exchange traded funds (ETFs). Instead, they aim for some of the alternative assets and techniques for making their money grow, or just preserving their wealth during an economic downturn.
This is especially true when inflation threatens, unemployment numbers begin to rise, and even new college grads have a tough time finding anything in their chosen fields. So, when the going gets tough, the tough take a different path, which for millions of people includes adding gold to their portfolios, engaging in day trading of penny stocks, acquiring a stake in cryptocurrency, and taking a closer look at real estate. Here’s more about each of these non-mainstream financial strategies.
Day Trading Stocks
The beauty of day trading is twofold. One, traders can earn a profit in markets that are trending up or down. Two, the profit potential of using penny stocks enhances the probability of success. When you begin a business like this, you’re literally investing in the concept and practice of day trading. To get started the right way, check out a complete online penny stock guide that includes watch lists of the best shares to buy and sell. Then, check this list routinely to stay abreast of the penny stocks that are most appropriate for day traders. Visit VectorVest for more information about the stock market.
Pre IPO Investing
Pre IPO investing is essentially investing in a company on a private basis before they enter into an IPO (initial public offering). When a company goes public oftentimes stock rises. It means that getting in on a pre ipo investment can be pretty lucrative. A lot of investors see pre ipo investing as a part of a wider, diversified portfolio. Private stock investing means that they aren’t widely impacted by the flows of the market and are instead valued only by company performance. Public stocks have this element but are also widely impacted by public sentiment and market flow. For troubled times, investing in private stock is a great option so long as you’ve properly put the research in and completely know what you’re doing. If you hit the right company with good fundamentals it’ll always be a good long-term investment.
Gold
Gold is an old standby for a very good reason in that it performs well when the stock market does not and is a good method for growing your money over time. Additionally, the yellow metal tends to rise in price the worse the economy gets. That’s probably because so many people view it as a safe-haven asset. Keep in mind that very few people put all their money into precious metals. However, as prices begin to rise in response to inflation and rising unemployment, gold often enjoys rapid and large price increases within just a few weeks or months. Contrary to what some people might tell you, there’s nothing magical about gold, but it does represent an asset class with unique features and opportunities.
Cryptocurrency
One of the newest safe haven assets is cryptocurrency. There’s an argument that says crypto is not a true safe-haven investment because prices are still highly volatile. Even so, many new and seasoned crypto owners acquire more of it whenever the stock market or the general economy runs into trouble, as it happened in early 2020.
Real Estate
Real estate, as well as REITs (real estate investment trusts), often follow precious metals prices in economic downturns. For all sorts of reasons, those who pay attention to the financial news tend to see true value in real estate, as opposed to intangible shares of corporate ownership represented by stocks. There are many ways to get involved in real estate from the investment side. Some people prefer to acquire properties outright, fix them up, and resell them. Others simply purchase REITs and participate, on a smaller scale, in the potential profits and losses of the general real estate market.
