Global investment markets are changing their dynamics and are expected to modify the way investors think of their portfolios as well. While none of the investment ideas below are fool-proof, they are due to secure portfolio diversity and boost market volatility resilience.
Savvy investors have to do their own assessments when assessing these suggestions’ viability for their own portfolios. Choosing stocks and markets that are expected to remain competitive and stable in time will usually help investors outperform others, in the long run. But still, there are several investing trends more likely to secure a good investment start.
Electric cars are growing in popularity and electric car sales keep rising unexpectedly. Investors interested in this type of investment can enjoy a series of flexible options. Reputable electric vehicle automakers like Tesla Motors or Toyota allow investors to choose electric cars to diversify their portfolios.
Financiers can invest directly in Tesla electric vehicles by purchasing stocks. A less risky investment option in regards to electric cars is ETF investment. The available securities can be purchased in relation to electric vehicle production or spare parts.
Alternatively, investors can buy stocks and securities in car part manufacturing companies, as a mean of gaining exposure to electric car investments.
However, one of the most secure investment methods in electric cars seems to remain ETFs. Exchange traded funds targeting this automotive niche allow investors to purchase and share funds tracking developments in the industry. When placed across several manufacturers, these investments are due to reduce investment risks and offer higher returns, assessed at the average returns of the whole industry.
For the past several years, digital security has been an area that gained more exposure. The Facebook and Cambridge Analytica disputes brought under the spotlight severe security breaches and concerns of the digital sphere. Given the exposure of the topic, digital security companies have gained the attention of reputable investors from different corners of the world.
Cyber threats are a hot interest area regardless of what industry different companies activate in. Financial institutions pay extra attention to their cybersecurity capabilities, but so do e-commerce platforms, small businesses and enterprises and even private Internet consumers.
Investing in digital security has, thus, become a trend in the past few years. Venture capital firms have invested in 300 cybersecurity firms and start-ups, in 2016 alone. The investments are valued at more than US$ 3 billion. But venture capital firms are not the only ones that can effectively and profitably exploit the opportunities opened by digital security. Private investors also have several options to increase the market volatility resilience levels and create a more diverse portfolio. ETFs remain the less risky investment option in this particular case, as well.
Technology influences all aspects of our lives and all industries. Savvy investors can secure their portfolios with investments’ in the sector help. As technology is vastly integrated with our lives, new opportunities and paths open to investors. For instance, earlier this year, Verint Systems, acquired smart city company Nowforce. With a long history in smart city solutions, the Israeli-American company Nowforce was purchased for an unknown amount. Reputable investors like Dorian Barak, local VC investor, and other prominent investors from all over the world enjoyed important returns on the move.
With deeper digitalization of societies and affordability of smart devices and Internet access, smart cities are becoming the norm. While American and European cities already designed their own smart city versions, the Asia Pacific comes from behind and is due to catch up with new technologies, known as proptech (short for Property Technology).
But smart city tech is not the only high-interest area with a huge return on investment potential. Financial services and healthcare are two sectors where technology is about to penetrate deeper and open new investment opportunities to savvy financiers. New niches and verticals are still due to emerge and disrupt the tech sector and investments in the areas are announced to become increasingly profitable.
Another area investors should look into more closely in 2019 is dividends. Dividend stocks can be found at those profitable companies with excess cash. Profitable divided stocks not only pay regular amounts, but they also raise their dividends annually.
Investors that consider purchasing dividends should also know that some companies pay dividends besides their regular ones. Costco is a good example. Financiers should know that Texas Instruments is a great investment tool, with dividend payment percentage of approximately 3.3% of the current stock price. The company has also experienced a positive trend for the last 15 years, being a certain income generator for many investors.
Maybe the surest way to secure and diversify investment portfolios are foreign market investments. Because markets are sensitive to economic and political changes, investing in foreign assets is a smart decision. An industry thriving domestically can be poor-performing on foreign markets and vice-versa. Maybe one of the easiest way investors have at hand to tackle foreign investments is through a mutual fund. Mutual funds holding foreign securities also offer the big advantage of professional management included as well as some varied asset options. Financiers can choose from stocks, bonds or money market funds.
- Overseas and international funds. These investments target markets outside of the US and buy securities in mature or developing countries.
- Global or world funds are a little different, because they also hold bonds and stocks in the US, apart from foreign markets. Trading is carried out depending on which market is best-performing at any given time.
- Country funds hold investments in a single overseas country. Many experts would advise looking into those countries with huge development potential, like the Asian countries or emerging Middle East markets.
Regional funds work on the same principle as country founds only, instead of focusing on the market in a single country, focus on an entire region, like the Asia-Pacific.