For many, the global stock and bond market is complex, confusing, and challenging to navigate. Add to those challenges the uncertainty centered around the pandemic, job insecurity, and the general economic instability in the U.S. can make financial decisions much more anxiety-riddled.
There are a variety of investment opportunities, each with its own risk, that you can consider. The investment boom is fueled by people’s desires to make and earn a passive income, add to retirement funds, and provide a level of financial stability that traditional jobs may lack.
Finding hidden gems, alternative investments like NFTs, cryptocurrencies, and other opportunities to consider are excellent strategies to minimize your risk while having the potential for positive earnings. The point of the strategy is to consider a mix of short-term aggressive exposure (and potential gains) versus longer-term investment that takes time to mature and earn.
Types of Investment Vehicles Worth Considering
There are countless investment opportunities to consider, from Bonds to traditional stocks, cryptocurrency, and more. So how does the average investor make sense of all the options available? Investing isn’t easy and comes with some risk, but by taking a diversified approach, you should meet some of your goals while simultaneously lowering your exposure to risk.
Below we offer three suggestions of what to invest in to maximize your potential. However, it’s important to keep in mind that this is a suggested strategy and not a guarantee to any particular outcome. You should always be sure to invest only with capital you can afford to lose, and always do your due diligence before making any major moves.
Several factors have led to the crypto boom, ranging from the “boom” cycle of the investments, the rising popularity of the currency with celebrities and athletes alike, and the rise of social media as a primary form of information gathering. However, the primary benefit of crypto is the decentralized nature of the currencies. Being a decentralized currency means that its value is based on the demand of the currency rather than acting as a regulated form of legal tender.
In turn, this gives rise to the vast “booms” we are seeing. Nonetheless, one possible downside to this type of investment is that it comes with volatility that turns many traditional investors off. The risk associated with volatility is that the value can see wide swings daily, leading to significant earnings and losses in a single swing.
Traditional Stock Market
In traditional stock investing, you’re purchasing a share in a company that is anchored to the company’s value. As the value of the company increases, so too does the stock. As a result, there is some volatility in the stock price. Still, the swings in the value we see in cryptocurrency are not nearly as expected. There are regulations and safeguards to prevent the “boom-bust” daily cycle that crypto may experience.
The advantage that the traditional stock market has over cryptocurrencies then is stability around minor fluctuations. However, a downside to conventional stocks is that it requires a much more significant investment to see sizable gains. Furthermore, it also takes much longer to see the value and return on the investment.
Alternative Options: Penny Stocks with High Growth Potential
To diversify your investment strategy, you need to include a plan mixed with aggressive investments (such as cryptocurrencies) tied with more stable, long-term assets (such as traditional stocks). One way to make your investments more attractive and potentially secure higher profits in the shorter term is to consider looking at alternative options from the FANG and other blue-chip assets, such as penny stocks or out-of-the-mainstream investments.
For example, the move from internal combustion engines, gas-powered, to more hybrid and electric vehicles will cause a demand for the various components and materials that make up the eclectic vehicles. Some demand for electric vehicles stems from popular decisions. In contrast, others are generated from governmental action and incentives, such as those recently passed and signed into law by the Infrastructure Bill of 2021.
The bill is expected to have a positive economic impact of over $15 billion for investments and development of EV charging stations, tax incentives, and more. For electric vehicles, that means critical infrastructure is being provided by federal, state, and local government and private industry has more than enough incentives to move away from gas and toward hybrid and fully electric vehicle production.
These developments mean plenty of opportunities for an intelligent investor to find a penny stock with a high ceiling. For example, electric vehicle batteries are made from nickel and other precious metals. As such, nickel mining companies stocks are a hidden gem with tremendous growth potential and should be included in any investment strategy.
Of course, there is no guaranteed “safe” strategy to investing, but taking a slow approach with a long-term plan is the best suggestion for you to consider, especially as you start. This strategy doesn’t differ from ones suggested for Boomers to Generation Z, but the earlier you begin, the longer you have to accrue and recover from fluctuations in the market toward your investments.