The recent global pandemic could have a devastating ripple effect on the global economy. With an uncertain financial future in the balance, your choice of investment tool in 2021 and beyond could have a significant impact on your retirement fund.
In this article, we take a look at five investment opportunities that promise a higher earning potential.
1. Covid-19 Vaccines
Pharmaceutical companies that are developing Covid-19 vaccinations are a solid investment in 2021. The question is which one to invest in. The frontrunners are Pfizer and their partners BioNTech. When it was announced their COVID-19 Vaccine is more than 90% effective, the Dow Jones skyrocketed by more than 800 points.
2. P2P Lending
In recent years P2P lending has replaced banks and other traditional money lending services to help fund businesses. The investment works by joining a pool of investors who are willing to provide a loan in return for a share of the profits each month.
Whilst there is still a risk of business failure and fraudulent accounts, there are plenty of reputable P2P lending websites online that oversee crowdfunding projects and offer advice and assistance to business owners to maximize success.
In addition, there are other parameters that provide a safety net such as controlling the credit rating you consider for a borrower, an active community of investors and a strict application policy business owners have to pass to qualify for consideration.
3. Real Estate Investment Trusts
Real estate investment opportunities include owning multi-family rental properties and commercial properties or office space you rent out to businesses.
Whilst real estate investment typically requires a sizeable portion of starting capital, there are options with Real Estate Investment Trusts (REIT) that enable you to invest in a mutual fund populated by a pool of investors.
Dividends are shared in relation to the amount you invest without you having to buy, manage or finance properties by yourself.
4. Tech Stocks
Today’s equity markets are tied to trends in so-called “tech stocks” that see billions of dollars invested in commercial software, eCommerce platforms, streaming media, digital entertainment, artificial intelligence, virtual and augmented reality and more.
With the rise of the Internet of Things (IoT), wireless technologies and digital platforms, legacy systems are being replaced by “disruptive technologies. According to Gartner, nine emerging trends will accelerate demand for solutions and prompt 40% of companies to install critical tech by 2023 – which will reap high returns for investors.
Despite profitable opportunities in small pockets of the stock exchange, financial markets, on the whole, are not expected to perform well in 2021. The fallout of the Coronavirus pandemic is likely to take more victims – businesses and jobs.
In times of an economic downturn, precious metals are one of the few asset classes that perform well. Investment firms invest heavily in gold when stocks are underperforming in order to hedge against losses.
There are various routes in which investors can invest in gold such as ETFs, gold accounts and physical gold. Storing physical gold at home promises the highest returns, but requires a custodian to organise the purchase and arrange for delivery of your investment.
With investment funds likely to be extremely volatile in 2021, investors would be wise to seek the help of an experienced financial advisor that can offer flexibility and act quickly.
Why not give me a call and find out how we can make your money work for you in 2021.