As of now, the Coronavirus has been labeled a global pandemic whose effects are being felt all throughout the world economy. Markets are crashing, people are selling off stocks whose value is plummeting, and heads are rolling.
It’s going to take a while before things can settle down and stabilize, but during this time of fear and panic, if you’re a prepared investor then right now can be one of the greatest opportunities of your life.
As of this writing, low-interest rates and high housing prices prevail in the real estate market. This means that the market is in a bubble so it’s harder for people to make rent and invest in residential real estate.
However, it’s a good time to make a commercial real estate investment, provided you do so based on good research and after doing your due diligence on the available opportunities.
Blue-chip companies are companies that have been around for decades and have an optimistic horizon. These companies have large-cap stocks and market cap and include such big players as Apple, Amazon, etc.
The benefit of buying into blue-chip companies is that you can buy their stocks at a discount right now, and they offer a substantial long-term investment.
Also known as ETFs, or exchange-traded funds, index funds offer a secure investment option. That’s because they allow you to buy a group of stocks or companies such as the S&P 500 index fund which you can purchase through index fund companies.
They’re similar to mutual funds but without any active management behind them. They’re passive and have a low expense ratio. In fact, most Index Funds have 0.10% expense rate which means you can diversify your portfolio instead of putting your chips in one basket.
Emerging market ETFs are also very lucrative right now as well as ETFs of the oil market, and real estate investment trusts (aka REITs).
If you’re interested in individual stocks then you should look into tech stocks. Financial companies and big banks such as JP Morgan Chase, Goldman Sachs and Wells Fargo are always a safe bet, as well.
Tech stocks don’t tend to drop much, so remember to do your research and invest in companies that you believe in.
Travel and entertainment
This might sound like an oxymoron because travel and entertainment stocks are taking a beating right now, and might take a while to recover. This includes airlines, hotels, amusement parks, cruise ships, etc.
However, it’s important to realize that these particular stocks are incredibly accessible and almost everything is on sale. Plus, when things get better there’s reason to believe that we’ll see a big surge in travel and entertainment after a long time being locked in at home.
If you do have the resources to invest in the stock market right now, do your research and invest in a good business that’ll stand the test of time and recover from this and be better for it.
Avoid investing based on the headlines or buy something just because it has dropped in value. Invest in understanding financial literacy through books and other sources of financial information that will teach you how to manage your assets.
Understanding how money works, as well as the ups and downs of the market, will make it clear what you should invest in and how to do it.
Featured image photo by Austin Distel on Unsplash