It’s no secret that the stock market got off to a rough start this year. Stock prices plummeted, the Dow Jones tanked, and there was a sense of panic in the air. It’s normal to want to dump all of your stocks and jump ship into a different and more secure seeming investment when something like this happens. Rest assured, however, that while the waters are rocky now, it is entirely possible–some even say probable–that they’ll calm down.
What to Trade When the Waters are Rough
Just because the market has been a little jittery doesn’t mean that you should stop investing altogether. There are some types of trading that, while not completely jitter-proof, are more stable than simply buying and selling shares. Binary trading is transacted based on how you think a particular stock will behave from day to day. You bet on whether it will rise or fall and if you’re right you earn money! Sure it’s more of a gamble when the market gets difficult to predict, but it is a safer and simpler investment than buying a stock straight out and then having it tank.
Commodities are another trading option that is more stable than stocks. Investing in utilities, crops, precious metals, etc. These investments are all more stable than shares in privately held companies. Precious metals, in particular, rarely vary much at all in their worth. Shifting some of your portfolio there could be a good way to save your investments. If you decide to invest in utilities, aim for companies that provide alternative and renewable energy sources as the drop in oil prices has wrought havoc on fossil-fuel based providers.
Recommended Stock Investing Posts:
- How to Supplement Your Income with Stocks
- How to Use Behavioral Finance to Your Investing Advantage
- Top 10 Ways to Quickly Improve Your Trading Skills
- Why Blue Chip Stocks Should Be Your First Investment
- A Review of The Intelligent Investor by Benjamin Graham
- Why Leveraged ETFs are Better Than Futures and Options
- Advantages of Trading Small Cap Stocks
- How to Teach Your Children to Invest in the Stock Market
If you’re worried about your stocks and shares, 2016 is a good year to shift your investments to companies that make and manage their products and services 100% domestically. Part of the reason the market opened so badly this year is because China’s economy went haywire. So much of our own economy is tied up with the global market (China in particular), that when the countries that make our products’ individual components get screwy, our own companies falter as well.
…though if you have a gambling heart, it might be good to explore buying shares from major corporations while their prices are low, particularly if those companies have a reputation for innovation and adaptation.
One of the simplest and most popular methods of introducing oneself to investing and trading is to go the Forex route. Forex is simply the trading of one currency for another in an attempt to grow your initial investment. It’s a good starting point because it helps traders learn how to follow market shifts and read trade tables. It helps them figure out what kind of trader they want to be and, when banks perform well, can offer a solid return on an initial investment.
This year, however, it would be prudent to reduce your investments in this area. One of the reasons that markets all over the world are going haywire is because the central banks that we’ve all been forced to rely upon for interest, inflation, and market rates are failing in their attempts to stabilize the global economy after the 2008 disaster. Currently, currencies all over the globe are losing their value. Even the American dollar is only valued at 90.
What Should Newbies Do?
If you are totally new to investing and have been looking for a way to start building your portfolio, 2016 is the year when you should explore independent investments. Yes, all investments are tied at least peripherally to the market. Still, some investments like retirement funds and investing in startups (especially if you are contracted to receive a percentage of the profits as the company grows) are good places to start putting your money. Precious metals and binary options, as we mentioned, are also less likely to spin out of control.
Whatever you choose to do, remember: investing is a great way to ensure your future financial success. Be smart, tread carefully and embrace pragmatism this year and you should be fine.