There are signs all around us that the economy is making serious improvement, and that now could be the opportune time to look back on investing lessons learned over the past 5 years, and apply them to an educated investment strategy. It would be an understatement to say it has been nerve-wracking for fund managers, who have had to manage their portfolios through a global credit crunch, a bear market, the Great Recession, the worst labor market since the 1930s, bank bailouts, the collapse of the housing market and an unprecedented monetary easing by the central banks.
With that being said, I am certain that there are a lot of very good reasons, for a person to invest in tangible hard assets; especially in times of uncertainty. Hard assets can offer benefits that other investments cannot. For an investor who has a traditional portfolio filled with stocks and bonds, adding something tangible like investing in diamonds, can help them diversity their investment portfolio; and accommodate risk. Furthermore, with hard asset investment, there is also the opportunity for very competitive returns, as well as; the opportunity to preserve personal wealth.
After five years, everyone is filled with uncertainty. We were always told that shares returned a dependable 8%-10% per annum. Then, the mantra was, real estate always goes up. The retail investor world is really just starting to learn about the advantages of alternative investments and how they can complement a traditional portfolio. Of course, all things in moderation. People shouldn't overdue on alternative investments any more then on housing or shares. The point is to have a diversified portfolio of assets that do not move in sync with each other. And interestingly enough, I just recently read an article supporting the author's point about diamonds. Evidently, Chinese are piling into diamonds both for investing purposes, wealth protection purposes, and just as displays of new found wealth. If there's a trend in China - whether its' investing in overseas farmland or buying diamonds - then that's a trade I'd want to look at pretty closely!
ReplyDeleteSome analysts believe that the worst of the “Great Recession” is pretty well over. The west is now in slow recovery mode and it may still take years to bounce back but at least it will, eventually.
ReplyDeleteLet’s just hope there are no more giant stock and banking scandals like the ones that had caused this global financial meltdown in the first place. Maybe they have learned their lesson. Let’s all hope.
DeleteInvestors like to invest their hard-earned money into something that will generate a profit for them at some point in the future. In fact, that’s really the only reason they do it. The problem is finding a good solid investment that is simple to understand and can consistently deliver the goods, like hard assets.
ReplyDeleteIt seems that the traditional investment strategies of the past will one day only play a minor role in the future of the global economy. Hard assets are the way to go. They deliver positive returns even in negative economic climates.
ReplyDeleteWhat more can you say about hard asset investment other than they are reliable and consistently generate positive returns to their investors. What more could an investor want at the end of the day? That is all they are looking for in the first place with their investment. Profits.
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