Investing Strategies for Uncertain Times

With the current state of the global economy, investing can seem like a daunting prospect. However, experienced investors suggest that now is the time to start investing if you haven’t been motivated to do so before. With free capital losing value daily, there’s no time to wait.

But that doesn’t mean you should dive headfirst into investing on the recommendation of the first financial advisor you meet. Start by educating yourself about options and investing small amounts in multiple projects or assets. Diversification is critical whether you’re fighting inflation or looking for growth.

One option to consider is government bonds, which can be tempting, especially if you’re looking for a reliable and low-risk investment. However, experts say they currently offer relatively small returns compared to the current inflation rate.

Stock markets are prone to significant fluctuations, and with the current state of the economy, investing in individual stocks may pose a higher risk than usual. Suppose you do plan to invest in individual stocks rather than indexes. In that case, experts recommend doing so only if you have the time and inclination to thoroughly research the company at the time of purchase and throughout the entire time you hold the stock.

Open-end mutual funds are also worth considering. They are classified according to the assets in which they invest most, such as equity, mixed, bond, and money market funds. Higher risk can lead to higher returns with equity funds but also higher losses. Investments in bonds and money markets generally offer lower returns but greater predictability of results.

Crowdfunding real estate investment is another option, which can be a profitable way to invest even in times of high inflation. Through platforms like BrikkApp, you can invest as little as 500 CZK in European projects and diversify risk thanks to different regions, currencies, and types of real estate. According to experts, possible returns are between 7 and 12 percent per year. Typical investment horizons for projects are 12 to 24 months.

Regarding real estate, residential properties in the Czech Republic are currently suffering from a decline in demand due to rising interest rates and associated price stagnation. In the case of commercial real estate, however, the situation is better. Increasingly, people are investing their money in real estate purchases abroad.

Gold and silver are historically relatively stable precious metals that tend to appreciate over time, but their prices can fluctuate. Consider any fees for storage or delivery. Gold can be added to a portfolio, but only as an additional investment with a maximum weight of around five percent. Gold is more risky and less profitable in the long run than stocks. Additionally, it would be best if you were careful about the terms of buying and selling.

In conclusion, diversification is critical when investing in uncertain times. Consider government bonds, mutual funds, crowdfunding real estate investments, and precious metals, but remember to educate yourself and research your options thoroughly before investing.