It has been an inexplicable year, and the biggest happening that has had our jaws ajar throughout the year has been the COVID-19 pandemic. It left countries locked down and kept billions of people in their homes. On the economy, it left a devastating effect.
Around the world, businesses were forced to shut down, and staff furloughed or given the sack because businesses couldn’t afford to keep running. This, however, isn’t the story for all types of business as some saw a dramatic rise in profits serving as evidence that it is possible to earn money in a time like this.
An area where people still made money is investment in financial products. Going by recent events and trends, listed below are five financial products to invest in during this pandemic.
The Stock Market
If you are an institutional investor, you know how interesting the stock market can be. The market is a reactionary one and events around the world shape the market. The pandemic has in no doubt affected the market and there have been losers and winners. One winner you should invest in is the sex toys market. Sex shops have hardly felt the negative wind of the pandemic. A popular store like Bondara still offers toys at huge discounts serving as evidence of the lucrativeness of the industry. Need to find more stores to vet this claim? Go on ReviewBirds to discover more, and even read finance services reviews to discover establishments that could help you build up your stock investment portfolio.
In times of instability and uncertainty, gold, silver, and other precious metals are some of the best safe-haven assets to own. The global outbreak of Covid-19 has not affected the price of gold and it has held its value exceptionally well. At the time of writing, its year-to-date value has risen by 18%. If you invest in markets out of the United Kingdom and in the US for example, it would benefit you to know that relatively, the Dow Jones Industrial Average and the S&P 500 index have both been down since the beginning of the year. This goes to show the stability of the price of precious metals during times of instability. Most of the time, you either have the price of precious metals stay the same or experience an increase. Investing in precious metals could help tie down an amount of money since the metals hardly ever lose value. In the end, you could end up with more than you’ve invested.
Digital assets such as Bitcoin and ethereum have had their legitimacy to be a hedge against inflation questioned. The important thing to note is that these currencies have performed well when compared to traditional assets during this pandemic. The spine of digital currencies is the blockchain. It is sometimes confusing to non-technical people, but the blockchain is not just a network for cryptocurrencies. It can also hold apps that function just like traditional apps. These apps are safer than traditional apps because governments lose their ability to track citizens. Big tech companies can’t collect data on you and track your activities all over the internet. The increase in virtual presence during this pandemic has internet users panicking about its implications. It implies that governments have access to large data sets to perfect their intrusive tools. The same worry goes for big tech companies like Google, Facebook, Amazon, and others who are known to edge around privacy violations. Apps on the blockchain have experienced an increase in usage and that is great news for cryptocurrencies too. Apps that have functionalities to perform financial transactions make use of digital currencies and that has pushed their value even higher. In May, the price of bitcoin was $9000. Six months later and at the time of writing, its price has shot up to $19000. With the pandemic threatening the way the world used to work, we could see an increase in the adoption of cryptocurrencies.
The stock market is volatile in times of economic instability. Lucrative market positions in one month may not be in the next month. Holding cash can help hedge against risk in the securities market. In such a period of economic uncertainties, you might want to reserve a portion of your portfolio for cash on hand. You have to take into consideration the tax implications of this decision.
Yes, we’ve mentioned the importance of investing in the stock market. Tech stocks, however, deserve a separate mention because of how incredibly valuable they’ve turned out to be in this pandemic. Tech stocks such as Zoom Video Communications, and Slack Technologies have seen an increase in value. The lockdown has increased the demand for these technologies as various businesses try to keep running remotely.
There is no investment strategy free from risk. As true as this is, some strategies can minimize risks. Invest wisely and build a pandemic-proof portfolio.