Safest Financial Assets In 2020 - What Are Your Options?

The outbreak of COVID-19 disturbed the economies worldwide, leaving millions of people wary of financial security and the prospect for future income. Thus, the surge of interest in investing in financial assets does not come as a surprise, however, how does one go about it? Here you will find a list of your options and the pros and cons of investing in each one of them.

1. Currencies.

Currency trading is one of the most popular ways of securing some extra income. It is accessible to everyone, can be done online from anywhere 24 hours a day, 5 days a week. It is beginner-friendly, with plenty of opportunities to explore and learn before diving deep into it. Furthermore, having access to leverage would allow you to significantly increase your profits. On top of that, high liquidity and fast development of the trading market mean that the sales are done shorter and the return is faster. By trading currencies, you can minimize the risk of insider manipulation, as the market limits the potential effects of the private information withheld by a small group of individuals. With the COVID-19 induced regulations in place and a growth of interest towards currency trading, brokers all around the world are introducing special benefits and regulations to accommodate for the influx of new traders, says Ann Cook, Chief Market Analyst of www.forexbrokerslist.com, thus “the conditions for new users to join in are better than ever”. If that is still not enough to convince you, bear in mind that if you are one of the lucky few with access to the currencies of smaller countries, you have ample opportunities to earn extra by benefiting from the significant fluctuations that such currencies often undergo, sometimes on a daily basis. Sounds great, but what are the cons? There are some pitfalls of the currency trading that every small trader should be aware of before going into it. Firstly, the market is more beneficial for the major traders, who, naturally, have a competitive advantage simply by having access to more resources and being able to influence the market prices. Moreover, like many other markets, currency trading is subject to volatility, and small traders looking for fast income might find that trading is unprofitable. Finally, regulations of the currency trading markets are not ideal. Although some are in place, it is usually your responsibility to research and assess your broker’s trustworthiness on case to case basis.

2. Stocks

The stock market provides various opportunities for amplifying your income, and some built a fortune by investing in stocks. Your options are unlimited, and you can choose to invest in a small business that you trust to develop rapidly or an established corporation with a reputation that will make it seem like a stable and secure option. Transactions here are done fast and easy, meaning that you can get cash quickly by selling one of your stocks. Moreover, you can benefit from receiving dividends and ensure that extra flow of income. Amidst the global pandemic, and with a lot of free time on your hands, exploring the stock market might be the option for you. However, as previously mentioned, COVID-19 has caused a major disturbance to the economic processes worldwide, thus, leaving an already unstable stock market in an even rockier state. Investing in stocks is risky, and you should prepare for the possibility of losing, often everything. Similarly, dividends are also highly unreliable and can go down just as quickly as they went up. Finally, although transactions are done fast and easy, they do come at a price, which means that you are charged both when you sell and when you buy.

3. Cryptocurrency.

The cryptocurrency craze remains high ever since it became a popular topic on various social media platforms. It is accessible for everyone, and if you manage to invest at the right time, it can act as a secure asset that can get you that extra cash when you need it. Another advantage of choosing cryptocurrency is the anonymity that goes with it, meaning that you do not have to reveal any personal information while trading it. Finally, trading platforms are available 24/7, thus, you can be your own boss and work out flexible working hours that you want to spend trading it. With the worrisome, pandemic- induced fluctuations of other trading markets, many have found an investment in cryptocurrencies to be a reassuring safe haven for securing income and generating profits. The main con of investing in crypto trading is, yet again, the high volatility of the crypto market, which is further exacerbated by the outbreak of the COVID-19. Moreover, cryptocurrency requires quite a bit of technical advantage and you will need to dedicate some time to researching and studying processes associated with cryptocurrency to secure your profits. Finally, the anonymity of the cryptocurrency concept makes it hard to regulate it, often making it an easy target for hackers. To avoid that, you will have to choose a secure and trustworthy source of mining and trading it, and it might be tricky to find one.

4. Commodities.

Keeping commodities as a way of securing financial assets has been used since ancient times. The options vary, and a lot of them do provide some opportunity for maximizing your profits since the demand for commodities often grows. Moreover, unlike other financial assets available, commodities benefit from inflation, instead of being negatively influenced by it. Finally, if you invest your money in a stable commodity, such as gold, your assets are almost always guaranteed to be safe. Nevertheless, before jumping at the opportunity, do keep in mind that the outbreak of the global pandemic has disturbed the production, import, and export of goods worldwide. The commodity market is subjected to high volatility, especially amidst the COVID-19 crisis, and can often be the opposite of a secure asset. Moreover, unlike other options discussed before, commodities do not produce additional income.