Almost all Brits with earnings above their basic needs consider investing. Many, however, give up on the idea of investing their extra cash, explaining that they do not know what to invest small amounts in. Unfortunately, despite the positive economic situation, we still feel poor. This is an incorrect approach because cash kept in a sock or bank account loses its value, but if you invest this money, it can generate a lot of profit.
Is there a way to invest safely?
Is there a 100% safe way to invest money profitably? No. Even those types of investments which have a good chance of generating a steady and reliable profit, can also generate losses due to external factors. This particular situation was experienced by the Greeks, who felt the consequences of their national economy going bankrupt. But should this fact discourage us from investing? No.
Investing is like life, almost nothing brings a profit without our own contribution. The trick is to know what risks to take and how to profit from this risk. The investment market offers both relatively safe investments, which are independent of the trend, as well as high-risk assets which are dependent on the stability of the international economy and the situation on the market. This means that investing almost always involves some risk.
What is the risk linked to investing?
Investment risk varies depending on the chosen investment option. The money market, or so-called Forex, is considered very risky. This is due to the leverage mechanism, which can be used to make investments with large quantities of cash. Unfortunately, bad decisions can lead not only to the loss of capital but also to generating debt.
Cryptocurrencies can also be risky. Only recently, anyone asking what to invest large sums in was told: cryptocurrencies like Bitcoin and Altcoins. However, the value of cryptocurrencies can drop by up to 90% in a flash, which actually took place not so long ago.
There are investments with a much lower degree of risk, such as deposits or cash funds, which are a noncommittal method of earning a certain percentage of the invested amount. Some alternative investments, such as buying gold coins or bars, are also considered very safe. However, these are long-term investments, which may last for decades.
What is worth investing money in?
With investments, it is much easier to say what was a worthwhile investment in the past rather than what items or solutions should be invested in at this particular moment. However, you can rely on the opinions of experts and your own preferences.
If we look at the economic situation, it is easy to realise that this is not the right time to invest in the most developed companies in the Western markets. Very highly developed countries, especially the so-called old European Union and the USA, are currently increasing their potential at a very slow pace. At the moment, it is good to take an interest in the local, Polish or alternative markets, for instance, Turkey, or China, Japan, and their economic potential.
You can also invest in assets that are not overly dependent or completely independent of the condition of the global economy, for example, gold, diamonds, cryptocurrencies or expensive alcohol.
Examples of the most advantageous investments
Cryptocurrencies are still considered to be the most advantageous investment of the decade. Someone who invested in Bitcoin a few years ago could have become a millionaire with very little capital. Nowadays, many types of altcoin offer an opportunity to repeat this situation.
The Polish stock market is doing well in the IT, entertainment and pharmaceutical sectors. A typical example of a good stock market investment is CD Projekt, known mainly for its creation of the world-famous game series about the Witcher, Geralt of Rivia. CD Projekt shares have been generating profits for years, bringing investors very good rates of return and high dividends.
The segment of the so-called very alternative investments is also doing well. Rare coins, dolls or figurines, sets of building blocks and even virtual items – Counter-Strike in-game weapon skins or Team Fortress 2 hats – all sell very well.
So, what should you invest in? Regardless of the chosen form of investment, it is definitely worthwhile to look into the future and act in such a way that the capital earned is not eaten up by inflation. There are a lot of assets worth putting our capital into, but there is not and probably will never be a definitive answer to the question of what is worth investing money in. It all depends on the risk that the investor agrees to accept.