The main 'gurus' of global economy are reporting serious dammages in the financial sector and at least 2 year to recover its necessary good shape. What to do when the two traditional investments lines, real estate and stocks, are broken?
The answer is clear, explore new niches safer than those two. Easy to say and hard to concrete. First of all you have to accept that a 10-20% minimum of your portfolio should go to explore what the mass media is considering the future. And with the rest taking conservative positions as TIPS (Treasury Inflation Protected Securities), but don't expect too much for the next two years. Even our portfolio energy master is suffering losses (-6 % as average) from first January.
This minimum percentage will be your only opportunity to find some financial satisfaction in this turbulent times. Lets follow our instinct. Scarcity is a fundamental factor for prices and profitability and abondance is a negative factor. When you saw formerly how easy the credit was, your normal reaction should be to abandone the market quickly. The good investors only succed during short periods of formation of socio-economic behaviours or sector trends. But when you feel the market is fully serviced, please run away and rest in no risk positions.
Some reflexions: invest today around energy, but take care when the crowd is arriving, it's time for selling. Invest in the knowledge industry, specially via internet. Invest in metals, minerals during the expansion of companies. When you read that a project is needing 5 years is your time to buy and after those 5 years, even when the company is profitable, you have to sell. Because you are not talking about dividends, you are talking about stock value. And the new king in that already cosolidated industry is the management, not the investor.
If you are a person trying to get something else than money from your life, invest this free percentage in what you really love. Take a long term position with a credit to share the project in which you'd like to be involved. Time pass very quickly and the 80 % conservative will care you, but don't lose the opportunity to assit to the birth of a private company. No matter how small is your stake, you'll feel necessary and more important, you will share a hope, the invisible substance that make us to live longer and younger.
In my main private project, focused to 5 years of oil success commitment and ocean research, we are considering to buy a little fleet of Remotely Operated Vehicles, ROV's, similar to the picture. I feel in advance that in every immersion will bring a piece of hope. Hope in extraordinary findings under the sea, hope in a better world in which explorers are fighting to protect the earth with their discoveries, hope in a rich life of emotions. My time and yours are irreversible and I have decided to take care for the 80% but not being its slave.
Maybe you could find a strong reason to invest near your sofa, but I recommend you to abandon your financial credo with the past. After this crisis many things would run not as you see in your rear-view mirror. Too much money and overall too much players able to invent the shortest way to crash your investment. When you find the motorway crowded, you quickly imagine a new route. The common way to get profitability is full of new drivers trying to arrive first. Use your intuition and explore new niche markets.