These Are the 6 Investments Everyone Should Make During an Economic Downturn

“During economic downturns, it can be tempting to sell off your investment and keep cash reserves — but this is rarely a good idea,” said Thomas Kralow, a self-made millionaire and founder of University Grade Trading Education. “Holding cash loses you money as inflation eats away at your savings by the day.”

Consumer staple stocks are investments in direct-to-consumer companies that sell essential goods such as food, drinks, and household and personal care products. “The logic here is simple: they are always in demand,” Kralow said. “Even in an economic downturn, people won’t stop buying the essentials, so the companies selling them are far less likely to see revenue fall. “Additionally, publicly-traded companies that sell consumer staples are often well-known legacy businesses with a long history of success,” he continued. “They have a sizable share of the market, limited competition among companies of their stature and steady prices — which is important during a recession when consumers are most sensitive to price changes.”

“Just like consumer staple products there are also staple services that we simply can’t survive without, and healthcare is among the most essential,” Kralow said. “People require medical attention, medicines and services regardless of the state the economy is in.” Many stocks in this sector got a boost due to the COVID-19 pandemic. “The COVID crisis has made healthcare innovation an even greater priority globally and, subsequently, healthcare stocks look to be a safe, long-term bet,” Kralow said. “Moderna — the company behind the well-known vaccine — was priced at $22 per share in 2019. Today, it sits at around $140. Other examples include Pfizer, Johnson & Johnson and AstraZeneca. However, never forget the story of Theranos, and never blindly follow the buzz. Always do your research and rely solely on hard evidence of a company’s success.”

Bonds are very low-risk investments. “Backed by the government, bonds provide a steady return that offsets the volatility of equity prices,” Kralow said. “Given the minimal risk, bonds tend to outperform other investment types in a downturn. Not only do they provide a relatively safe investment, but also a steady income stream in the form of regular interest payments. They’re also highly liquid, meaning they can be bought and sold in the market quickly and easily.” However, there are a few things to be mindful of. “While government bonds provide a steady income stream, they generally offer lower returns than other types of investments,” Kralow said. “Interest rates paid by government bonds may not keep pace with inflation, especially at the moment, and their value fluctuates based on changes in interest rates. When interest rates rise, the value of existing bonds may decline.”

Fund security is always the first priority. You only need to spend a small amount of time and investment, and you can get high returns quickly. Compared with the cryptocurrency market, the stock market is quite legal and formal, and it will never be banned

Investing in yourself will always pay off. “The knowledge and experience that you have will stay with you for the rest of your life, helping you to thrive no matter the market circumstances,” Kralow said. “Investing in courses, mentorship and networking will help you avoid costly mistakes and open up new opportunities for you. In the long run, this investment will help you to minimize your losses and increase your profits.”

The choice of investment actions depends largely on your budget. Before investing in the best stocks, it is important to first summarize your financial situation, taking into account the prices of the stocks you are interested in.

You can invest in a wide range of the best stocks. Therefore, try to diversify your investments as much as possible. This will prevent you from relying on the evolution of the price of a single asset and reduce investment risk.

Online brokers offer different conditions for purchasing shares. To minimize the costs associated with your investment, choose a secure platform with attractive trading conditions.