Depending on who you ask, the range of alternative investments during the recession may appear to be limitless. The moves you can make change daily as everything from gold prices to retail earnings are in a state of perpetual flux. Despite this, there are some sectors that have performed better historically than others.
Alternative Investment Strategies
Other strategies to consider during a recession are:
- Taking advantage of lower stock prices to buy some dividend-generating stocks or shares that were previously out of your price range
- Precious metals, such as gold are a good investment alternative, just keep your eye on the market for when the price drops again and then buy
- Money market funds are considered a safe alternative for storing cash and although they may not earn you a fortune, the current interest rates hedge out the average rate of inflation
- Some investors advise against seeking out “hot stocks” at all and encourage investors to put their money into exchange-traded funds (stocks that track the performance of major market indexes), as that will get them to profit on the rallying of stocks
- Bonds are also being promoted by financial experts, however the type of bond you may want to purchase will vary based on your risk personality and amount of money you have to invest
In general, strategic investing during rough economic times will always yield better results as traditional stock investments are likely to suffer losses.