Most Profitable Investments You Can Make
as a New Investor
Whether you’re looking to save up for retirement or simply keep funds for an emergency, the best strategy is to let your money grow through investments. In fact, if you’re afraid that the pandemic has made investing a lot riskier, don’t worry. “Consumers are becoming more confident with vaccine news.
There is a giant pent-up demand for travel and shopping,” writes Peter Hodson, the Founder and Head of Research at 5i Research, in his recent column. Travel stocks, real estate, tech companies, and other assets are slowly growing in value, making 2021 a really good time to start investing.
But where do you put your money? What assets belong in a lucrative portfolio? Remember that it is important to rule your retirement. Here are some of the best investments you can make if you’re a new investor:
Every investor knows that they must diversify their portfolio. After all, assets react differently to the same economic event (like how travel assets dropped in value last year but food didn’t). Therefore, investing in multiple industries is a great way to minimize risks and ensure profits, no matter what happens. The easiest way to get into this is to invest in mutual funds.
A mutual fund is managed by a professional. They put your money into the top-performing entities of the category you choose to open a mutual fund in. For example, the assets in “equity funds” are all corporate-owned (food, utilities, etc.).
Meanwhile, “bond funds” go to government projects. Some advisors will even offer you a “hybrid” batch. To open a mutual fund, you will need to call your financial advisor and start an account. Investing in index funds is also an option. It has lower fees than managed mutual funds.
Of course, you can skip the pool and invest in individual stocks directly too. But in this case, you might want to skip out on getting an advisor and create a brokerage account instead. Similar to an e-wallet, money from a brokerage account can be used to invest in online trading platforms. This may take extra research on your end, but it also means better control over your finances and lower commission fees. One thing that can help you with your research is an online stock research tool, and there are many options available.
As mentioned before, you need to diversify your investments to spread the risks. As a rule of thumb, the safest investments are on companies that look like they’re growing in the next 10 years. Big food chains like Tim Hortons, utility firms, and online marketplaces like Amazon are good examples of this.
If you have the money for it, then a property is a great asset to own due to the promise of high returns. After all, as long as you maintain your property and are proactive in finding tenants, it’s a sure way to have a stable cash flow. Plus, you can lower your rental taxes through deductibles like insurance and maintenance. Check out the real estate investment funds that make your process easier.
To this end, we highly recommend investing in condominiums. They’re cheaper than a house, have lower maintenance fees, and are in demand because of the high urbanization in major cities. Just make sure to buy those that are not fully constructed yet. This lets you pay for the property in small percentages. Plus, you won’t have to worry about taxes and tenants until it’s built.
Depending on how much risk you’re willing to take and how big your budget is, there are many investment options to choose from. You don’t have to stick with one either. Do your research; see what ventures appeal to you more.