There are always new investment opportunities popping up, but they often come with significant risks.
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Cryptocurrency is a fascinating concept; however, digital currency has taken a hit in 2022. Tech stocks are renowned for their growth potential, but they are also suffering this year. NFTs are innovative and interesting, but most projects lose their value soon after launch.
If you’re looking for quality investments that can hold their value and bring some stability to your portfolio, here are some suggestions to get you started.
Real estate should be at the top of a list like this. It is an asset that has retained its value since the time of the pyramids.
The housing market is very high right now, which makes it a short-term risk. Inflated home prices can also make it difficult to find deals.
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Still, even in times like these, investing in physical property is still a powerful way to turn money into an asset that will never go to $0.
Tokenized real estate
It can be emotionally draining to invest heavily in something as volatile as cryptocurrency. The ups and downs of the crypto market – including the extended “crypto winter” of 2022 – can sometimes be hard to digest.
This is where tokenized real estate can make a difference. This new approach to investing combines the token nature of cryptocurrency with commercial real estate investing. It allows those who own digital currency to purchase a portion of real-world commercial property.
The ability to invest in commercial real estate is powerful. This is something that was once extremely difficult to do and required an astronomical amount of capital and know-how. In addition to being accessible, tokenized real estate is also an investment that can retain its value over time due to its association with the more predictable real estate market.
The non-fungible token (NFT) is the poster child for risky investing. It takes the volatility of cryptocurrency and applies it to an even riskier art-driven medium.
However, it is possible to discover legitimate NFT assets that will retain their value over time. Usually, this requires finding an established project that has a proven track record and regularly attracts new investors.
For those who are bold investors and good at their research, it is also possible to discover new NFT projects that could be good long-term investments. Remember that, in these cases, the odds are against you if the story has anything to say.
If you’re looking for a simple, proven investment option that will hold its value over time, look no further than a certificate of deposit. A CD locks your money into a product that pays a stable, though generally low, interest rate over time. You can’t withdraw the money, and it doesn’t tend to grow very quickly.
Nevertheless, the money invested in a CD is quite safe. It does not tend to lose its value easily. It is also insured up to $250,000 by the FDIC.
There are many other more aggressive ways to invest money and grow wealth. If you’re looking for stability, however, a CD will provide that in spades.
Investing in the stock market can lead to massive payouts. But it can also carry many risks.
You need look no further than growth stocks as an example of this risk in action. After the initial crash caused by the early days of the pandemic, growth stocks rose from hand to hand, until in 2022 they crashed – hard.
One way to avoid the volatility that comes with stocks like these is to invest in index funds. These are mutual funds or ETFs that spread their wealth evenly across an entire market index, like the S&P 500.
An ETF will dip with the rest of the market, but usually not as intensely as many individual stocks. The spread risk makes it an asset that tends to hold its value better than many other stock options.
Precious metals have had value since the dawn of civilization. From crowns to cups, coins to bars, gold has represented wealth for thousands of years – and it continues to do so today.
The important thing to realize is that while they can hold value over time, gold and other precious metals aren’t as predictable as, say, a CD. Gold can be volatile in the short term and should be left out if you lost money shortly after investing.
Even so, sooner or later it should return to its original value at the time of purchase – or more. This is because precious metals tend to hold up over the long term due to their limited supply.
Investing is tricky business. Most investors favor a balanced approach that combines high risk with predictable safe options. If you’re trying to balance your portfolio or start investing, the recommendations above may help, but keep in mind that these are recommendations only.
You can use assets such as index funds and tokenized real estate to provide building blocks for your wealth. That way, if riskier investments stumble in the short term or fail completely in the long term, you’ll still have a stable of assets that can function as the core of your wealth and grow it steadily over time.
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