The coronavirus is now not only affecting all of us by limiting the way we’re living our day to day lives, but it has also had a massive negative effect on most industries. Even sectors that were considered “safe cards” before have been caught in the turmoil.
As a result, people are losing their life savings and having years of profitable investments being levelled to the ground. But it doesn’t have to be all bad and with a good investment strategy, there are ways to make it out of this crisis on top.
There are even ways that you can make money with investments and online trading during the ongoing chaos, which is what we’re taking a look at today.
Picking an Investment Strategy
As with all types of investments, you need to pick a strategy before you do anything else. Due to the unusual circumstances, this step is even more important now than ever before.
After having scoured the internet and reaching out to several investment experts, we’ve found that there are two principal strategies that can be applied now.
Short Selling Struggling Stocks
Short selling, or shorting, is the concept of betting against the market. In most cases, when investing or trading, you pick an asset because you believe it will increase in value. When short selling, on the other hand, you pick an asset because you think it will decrease in value. Generally speaking, there are two ways to do this.
You either use a traditional stockbroker from who you borrow a security that you sell to the open market with the intention of buying it back for less, before returning it to the broker and profiting from the difference. This might sound complicated, but the process is usually automated, similar to a regular investment.
The other option is to use an online broker to speculate on market prices, thus betting that a particular security will decrease in value over a specific period of time. This method is, in many ways, much easier to understand and therefore suitable to most investors. To learn more about this concept and to find a reliable broker you can check this page: https://bullmarketz.com/best-trading-platform-for-beginners-uk/
Strategic Investments in Companies Benefitting from Corona
While short selling is a good method to make money during a financial crisis, it does come with certain unique risks. It also requires you to learn a new investment concept, which can be time-consuming.
Therefore, you may want to consider reinvesting your funds in companies that are bound to benefit from the coronavirus. We’ve collected three sectors that will likely produce profitable returns in both the short and the long term.
Remote Working: Since many of us have been forced to work from home, the companies that are making that possible by connecting companies online, are thriving.
For example, the video chat company Zoom (NYSE: ZM) has experienced tremendous growth in the past couple of weeks. Furthermore, the communication platform Slack (NYSE: WORK) is set to benefit from an increasing number of customers, and Atlassian (NASDAQ: TEAM), the software company behind the project management tools Trello and Jira, has great potential.
Energy: Despite a recent collapse on the oil market, several energy companies have a history of continuing to grow even during recessions.
Our two top picks at the moment are Chevron (NYSE: CVX) and ExxonMobil (NYSE: XOM). Both of these companies have stood the test of time and flourished during previous financial crisis and long recessions. Even today, when the price of oil is trading at a record low, neither of the companies have been negatively affected.
Health Care: The last sector that could have potential is health care, especially if we look at companies producing face masks, ventilators, and other medical supplies. Also, the company that ends up developing a vaccine or cure for Corona, will likely be one of the best investments of this decade.
With that said, the healthcare industry is very risky at the moment so we won’t provide potential investments suggestions. Instead, it’s up to you to analyse the market.
Disclaimer: these tips are only meant to be used as suggestions. No one can guarantee a profitable investment, especially now during unstable times like these.