It has almost been a year that a pandemic has halted the entire world. Major operations were either stopped or minimized from the month of early March and the same is being continued as the cases do not seem to stop. The stock market constantly crashed and came back up but on an average, the stock prices have only seen to be declining, and the market-cap-to-GDP is about 50% lower than before.
In such a situation, where most people are losing their jobs even after over a decade of experience, freshers are being denied their internship approvals, businessmen are seeing a steep downfall in their revenues, and job creation deteriorating – the topic of investment growth and opportunity has been dwindling in every body’s mind. People are scared about not only their future but even their present survival. There is a panic-stricken public wanting to work but not having the right set of circumstances for the same.
Some areas that can be looked upon by the people who are willing to invest in a risk averse market to gain some return in the future are –
- Sovereign Gold Bonds: The SGB’s being substitutes of physical gold, are the government securities which are denominated by in grams of gold. These are issued by the RBI and are a safe locker for investment as of now. Looking at the steered up gold prices, it is clear that the investors have forgotten to catch this bus which could be one of the few ways leading to their destination.
- Investing in a Bear Market: This might sound a bit odd to the new investors out there, but I am sure the experienced equity investors would agree with me on the fact that any market that crashes is bound to go up. Never in the history, has any market around the world ever seen a market crash which never revived. Which is why, when the market witnesses falling prices, investment sounds a good plan for the long run, because the revival is assured, keeping the market trends in mind.
- Sustainable Investment: An investment is termed as a sustainable/social/ethical investment when it seeks not just financial returns but also, a social/environmental welfare. This can be done by choosing companies to invest in whose behavior you highly approve of. One way to do this is looking for companies who have a signed agreement on the code of environmental conduct for businesses under the Coalition for Environmentally Responsible Economies (CERES) principles.
- Technology Driven Companies: Soaring higher day by day, technology is not going anywhere and is only going to flourish in the coming times. Even during the Covid-19 lockdown, most activities went online – from working from home to online retail. It is going to be very fruitful for any investor investing in technological companies or the e-commerce businesses.
- Fin-Tech: Just like the tech based companies we discussed above, fin-tech has been soaring for quite some time now, too; and shall be the same in the future. The times have gone when people only depended on physical banks and now have opted for robot-advisors, and S&I apps. Investing in such ventures is going to be a full-proof yielding opportunity!
- Liquid Assets: Keeping in mind that there can shortly be a liquidity crunch, an investor should be well aware about his investments in liquid assets like treasuries, bonds, and mutual funds. Keeping a fair share of investments in these liquid assets can be a major helping hand in the times of a cash crunch, but such decisions should be taken with high precision and keeping in mind all the dire negative possibilities.
- Bank Deposits: As we all have grown up reading and learning about how safe bank deposits are, for a safe investment with decent returns, such deposits can be a good financing aspect in a time like this. Bank deposits, being the traditional source of investment, also ensure liquidity and offers security of your capital. The only risk that comes along bank deposits is inflation which right now, is quite high itself.
- Investment Portfolio: A healthy balance created from all these investment opportunities is a well-considered option, too. An amalgamation in the form of an investment portfolio is always considered a secured option to deal in. Little of everything is observed better than more of one thing in such a prevailing situation!
These are the 8 possibilities that could help a person wanting to invest in safer stakes, most likely in the long run. The times we are all going through is one of the hardest to deal with, with countless hardships and obstacles awaiting our way. But one thing that we should all be certain of is that after dark nights there are always dawns and every storm is followed by a rainbow. This too shall pass and we shall overcome every single stumbling block which is thrown at us!
The content of this article is completely under the subjugation of my personal opinion according to the best of the knowledge I possess. Any action you take upon the information on this article is strictly at your own risk. Any decisions related with funds, instruments, or transactions described/mentioned herein must be made solely on the information contained in a prospectus and no reliance should be made on any other representation.
