Successfully investing in times of a pandemic
My investment strategy
Disclaimer: I’m no financial expert and this is not meant as financial advice!
Many people ponder their minds what to do with their savings. More and more banks are starting to introduce negative interest rates on savings accounts, inflation is showing its ugly head, and terms like ‘cryptocurrency’ are far too abstract for most.
Goal
First, determine your investment goal. Long or short term. Also, try to have a mindset that any money you invest (in whatever product) will be lost. In other words, don’t invest any money you don’t need for at least the next 10 years.
Diversify
Diversification has always been an often-heard term when talking about investments.
With the rise of new products, like interest-earning crypto wallets, as well as rising attention for age-old products like gold, there are many ways you can diversify your portfolio.
Stock Markets
With the endless printing of money going on everywhere in the world, the stock market is believed to be in a gigantic bubble at the moment (GDP’s are going down massively, while the markets are at all-time highs).
There might be some ETFs (mutual funds) that could be resilient to an eventual crash, but you would have to pick them carefully.
If you have a long-term goal, funds related to tech, pharma, renewable energy could be good choices.
Gold
Recently there’s been an increased interest in gold. China, for example, is slowly swapping their reserves (that are now in USD) for gold, betting on the collapse of the USD.
You can simply buy physical gold bars at many on- and offline shops and store them in your vault or under your mattress. Another option is to buy at online places like GoldRepublic, where your gold is insured and kept in a high-security vault in Switzerland, though this, of course, comes with additional fees.
CryptoCurrency
I won’t go into how to buy Crypto (such as Bitcoin) here.
You can simply buy some, store it in a wallet (to be safe, use an offline one, such as a Ledger). And wait for it to go up (or down → sell it!)
Interest earning Crypto wallets
In the past months, these services seem to be on the rise. Instead of keeping your crypto in your wallet, you store it at these services. They use the funds to give out loans and reward you with daily or weekly interest payouts. The rates vary from cryptocurrency to cryptocurrency, with USDT and USDC generally giving the highest rates. The value of these are pegged to the USD and don’t see crazy fluctuations like Bitcoin, for example. However, should the USD collapse, so will your USDT or USDC.
See also here, diversification is key. Don’t buy only Bitcoin, there are many big coins out there that are worth a look. I’d advise everyone to sign up to Coinbase and click the ‘Learn’ link to learn more about the big currencies and how they work before you decide which to buy.
After you have your crypto, you’ll need to send it over to the aforementioned platforms. There are many out there, but the ones I would suggest to give a try are Nexo.io and Blockfi.com
Any comments, questions or suggestions? Let me know!
