Even If There’s A New Depression, You Can Still Make Money On The Markets

With the world on lockdown and economic activity in many places temporarily grinding to a halt, the markets are in freefall. The Dow Jones industrial average had its worst-ever quarter in Q1 this year. 

But even though things might look dire for the average investor, there are still opportunities for other people to get into the market and make a decent return. There’s still money to be made, even as the world’s largest companies hemorrhage value at an unprecedented rate. 

Buy The Dollar

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The dollar has always been a safe refuge currency in times when the world seems as though it has been falling apart. Investors trust the US government to always pay them back the full amount of their investment, even if that means printing money. And so the value of the currency remains high, even when there’s a lot of borrowing and debt in the system. 

Buying dollars is relatively easy. You can either go to a forex broker or buy assets denominated in dollars through an app. If you’re already in the dollar, then you’re in a good position already. Panic in the rest of the world will likely cause investors to flee to treasury bonds, pushing up the price. 

Get Into Value Stocks

We have seen a massive decline in stock market values since their peak just a month ago, and it is not hard to understand why. Stocks were priced to perfection back in January, with investors expecting significant gains in the future. Now it looks unlikely that companies will achieve the same profitability going forward. The world economy is on its knees. 

Investors should seriously consider value stocks that are currently available at a discounted price. These stocks belong to companies with low debt, consistent revenues, and robust balance sheets, making them potential candidates for a positive stock market prediction for next 5 years. Generally, these stocks have low price-to-earnings ratios and don’t heavily rely on future growth to make them attractive for investment. It’s about finding shares in companies with a strong foundation and the potential for long-term stability and growth. 

Short Industries That Won’t Receive Government Bailouts

Governments around the world have said that they are going to provide funds to save as many companies as they can during the lockdown. But even the biggest state won’t be able to keep all businesses and industries. Some will inevitably fail. 

For investors who are comfortable with shorting the market, this is an opportunity. It is unlikely that governments will allow strategic industries, like airlines and airports, to fail. But they may enable legacy firms in retail and hospitality that were already struggling before the crisis to fail. 

If you’re not sure how to short the market, ask your broker. Beware, though, that you can lose more money through shorting than regular investing

Save As Much Cash As You Can And Pour It Into The Market

With people losing their jobs and incomes falling, amassing cash is more difficult than ever. But if you still have money coming into your account, now is the time to invest. Markets and economies have a habit of snapping back from their lows. It might be doom and gloom today, but the economy will return. And when it does, the value of your investments will bounce.