Market volatility is something every investor has to deal with. However, COVID-19 has brought new uncertainties most generations have never experienced before. Some investors saw the pandemic as a great way to take advantage of unique investment opportunities, while others played it safe due to the high level of uncertainty. No one knows how long the pandemic will occur and what impacts it will have on the world going forward. The more data we have, the more we can understand what investment strategies could be beneficial. We’ve taken a look at three ways to think about investments ahead of COVID-19.
Use Market Volatility To Your Advantage
Some investors may benefit from put options during these times of market volatility. With this strategy, investors have to commit to buying even if the markets drop. However, it also ensures the investor doesn’t commit too much money in cash, which could mean missing out on the highest upside of their investment. Since interest rates aren’t expected to climb any time soon, it could also be a good strategy for investors to look into high yield credit spreads or emerging market bonds. The low prices now are attractive and may be worth the risk for an investor when you consider the potential upside.
Consider Cyclical Or Select Value Stocks
Cyclical stocks and select value stocks are expected to perform well as global economies rebound from COVID-19. By investing in these ways now, you can take advantage of low costs and benefit from the high upsides later on. The problem is it’s too early to predict how high those upsides could be, so some investors are choosing to invest in more stable areas as a safety net. Dividend stocks and healthcare are two stable investment options to consider that offer high upsides with lower risk.
Invest In Areas That Will Be Advanced Resulting From COVID-19
When looking into investment opportunities today, focus on areas that could see growth as a result of COVID-19. Some examples include health technology, automation, e-commerce, food supply, robotics and other similar areas. We’ve seen how important these are globally throughout the pandemic, and COVID-19 may even accelerate these industries quicker than they were already planned. Buying into these areas while they are low is worth the risks for many investors as they have high chances for future success.
Stock Investing Info is here to help investors achieve financial success. We do this by understanding your portfolio, your risk tolerance and short-term and long-term goals. While the COVID-19 pandemic has been devastating globally, investors have taken advantage of the market volatility and could see significant returns when the world gets back to normal. Experts make their best predictions on how markets will react, but no one knows how impactful the pandemic will be in the next several months. We will help you look at every possible option to benefit your current and future financial situation, so contact us today to see how we can help.