Experts Recommend a Diverse Portfolio in a Post-Covid World

Posted December 16, 2020 by in Lifestyle

People are always looking for the best way to invest funds but, in reality, the most effective investments are those that reflect your personal financial goals and the risk level you’re comfortable with.

Due to the economic impact of coronavirus, many industry insiders are advising people to diversify their investments in order to maximize returns and minimize potential losses.  

What is a Diverse Investment Portfolio?

Diversifying your investments can be a viable way to protect your funds, particularly when the economy is notably unpredictable. A diverse portfolio is essentially a range of different types of investments. Rather than investing all your funds in stocks and shares, for example, you may want to split your capital investment into stocks, shares, commodities, property and/or bonds. 

If you really want to protect your capital and maximise returns, savvy investors choose investments that react differently to economic events. In theory, this means you shouldn’t make a loss on all your investments, regardless of how the economy performs. Although this can be a clever way to protect your portfolio, it’s important to remember that all investments can fall as well as rise. 

Consider Alternative Investments

If you want to invest funds, it might be beneficial to think outside the box. As well as choosing standard investments, why not consider alternative investments too? These can offer potentially high returns and are often a fun way to invest your capital. Alternative investments include:

Cryptocurrency

The value of digital currency, like Bitcoin or Litecoin, changes all the time. This means that you can make a profit on your investment by buying and selling at the right time. If you’ve never purchased cryptocurrency before, you’ll be amazed at how easy it is. To get an idea of what to look out for, take a look at this Coinberry Exchange Review – CryptoVantage.

P2P Lending

Becoming a lender gives you the opportunity to earn interest on your capital as it’s paid back by borrowers. The amounts you can lend vary, depending on the platform you use. However, this can be a good way for new lenders with limited capital to begin their investment portfolio.

Venture Capital

Investing in start-ups and growth-stage companies can be a fun way to use your capital, particularly if you take the time to choose to the company yourself, rather than using an investment manager. However, venture capital is known to be a relatively risky form of investment, so think carefully about whether it’s right for you.  

What’s the Best Type of Investment?

There are endless investment opportunities out there, but there’s no universal ‘best’ type of investment. With a little research, however, you can find the best type of investment for you. By assessing your goals, deciding what level of risk you’re comfortable with and accessing expert advice, you can build an investment portfolio that gives you the best chance of success.

By doing so, you’ll be increasing the chances of generating an income and increasing your capital.