We are currently living through turbulent times; the UK’s vote to leave the European Union (EU), terrorist attacks throughout mainland Europe, a slowing of the Chinese economy and, unfortunately, the list goes on. When there is turbulence in the wider political landscape, volatility in the world markets follows and while some investors see this as a time to consolidate or to rein in their activities, others see opportunity. Here are some factors to consider if you are interested in making money in a turbulent economy.
Different markets behave in different ways during turbulent times and it’s understanding this that might just give you the upper hand when it comes to making investments.
Foreign Currency (Forex)
It will come as no surprise that one of the markets that reacts most in times of turbulence is the Forex market and this can provide opportunities for investors. The Brexit vote provides a good example, the pound dropped dramatically on the announcement that the UK had voted to leave the EU. Those who sold sterling at the right time, then bought it again when it “bottomed out” and subsequently recovered, would have made a significant profit.
You can trade Forex with Hantec Markets using their Metatrader 4 online trading platform. The platform is user friendly and contains many features to help you trade effectively such as pending orders and trailing stops. Trading Forex is a high-risk/high return strategy, but a careful and considered approach can lead to great success.
On the opposite side of the coin, if you’ll forgive the pun, is gold. Historically gold has always been seen as a safe, long-term investment and one that is not easily affected by turbulence. Investing in gold can act as a firm foundation on which to build a more diverse portfolio that features investments with varying degrees of market risk. There are many ways in which you can invest in gold from actually buying physical gold and having it stored on your behalf to investing through instruments such as exchange-traded funds (ETFs) and so the future may be bright and shiny.
During times of turbulence, consumer confidence can be extremely low and the public at large are less willing to spend money where they don’t need to. One easy way for people to save money on a regular basis is by cutting back on the amount they spend on food and household items like cleaning products. Buying shares in budget supermarkets,Aldi being one, can offer very good rewards, as share prices tend to rise in times of economic uncertainty. And of course, if you opt to use the supermarket you invest in you’ll be making money while you spend it.
Many other investments that are worth considering during times of turbulence, vintage cars, fine wine and antique furniture being just some of them. So depending on your own personal circumstances, there is a lot to consider. One fact remains however and that is that in times of turbulence and market volatility there are ways in which you can invest and succeed.