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Keep Your Funds Safe During the Looming Economic Recession

(Credit: Keep Your Funds Safe During the Looming Economic Recession) Keep Your Funds Safe During the Looming Economic Recession
October 30
2:25 PM 2019

It's becoming more and more obvious that we are headed for a global economic recession. Certain experts are even worried that we might be headed for another major financial crash.

Naturally, this situation is spreading worries across the world, and people from all over are wondering what they can do to offset the inevitable. Unfortunately, there is nothing we can do on a personal level to stop or change the course of our global economy. However, there are ways that you can try and protect yourself, your funds, and all the investments you've made over the years.

In order to provide a useful guide on the topic, we turned to a team of leading financial and trading experts, and this is what they had to say.

1. Invest Your Money in Safe Securities

The number one thing we should all do when the market starts to turn is to try and protect our funds and investments. For example, holding on to all your stocks is not a great plan since the stock market usually tumbles the worst when the economy struggles.

Instead, it's better to find more of a stable security such as gold. In fact, gold is considered so safe that its' value increases when the stock market falls because so many investors end up switching their stock portfolio for gold.

Depending on which markets get hit the worst, there might be other "safer" securities, but that's hard to determine now. For example, it will be interesting to see how the cryptocurrency market reacts to a global recession.

2. Don't Be Afraid of Shorting the Market

Another great tip that many seem to overlook is short trading. The only way to make any decent money from a recession or even a full-blown market crash is to short sell.

Betting against the market is risky, and you need to know what you're doing and why. That being said, there are numerous examples of people making millions of dollars when the economy turns.

3. Learn How To Trade on Volatility

This tip goes hand in hand with the last one. Trading with online brokers offering CFDs and other derivatives is a fantastic way of maximizing profits during a recession.

Thanks to versatile trading platforms with large selections of assets, the option of using leverage as well as the lack of commission, you can not only protect your funds but even help them grow using brokers. Read more here.

Just like regular investments, trading is always risky, and you have to be careful, especially when the world economy is experiencing volatility.

4. Hope for the Best and Prepare for the Worst

Lastly, we always tell our clients and friends to hope for the best but prepare for the worst. That means that you might not be ready when the next crash happens, and if you react too late, the last thing you should do is sell off all your investments.

If that happens, it's usually better to sit tight and wait for the market to bounce back. Remember that selling at a loss now is worse and riskier than holding on to an asset, hoping to sell for a profit later.

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