Investing is inherently risky, which means that you face the very real possibility of losing your hard earned cash. If you’re someone who believes in preparing for the worst – a so-called “prepper” – then what investments can you make that will allow you to sleep easy at night? In this post, we will examine this in detail.
A prepper is someone who has taken it upon themselves to prepare for the worst outcomes. Be it a pandemic, nuclear war, an outbreak of disease, or another economic crash; the prepper is ready for the unexpected – whether that means stockpiling food, or keeping their investments secure.
Because investing is hard when you have no faith in the future. In fact, the very notion of investing is really based on trust in the economy and in business. If you think that an economic crisis is just around the corner (and you would be forgiven for thinking so!), then how can you help your money to grow?
Fortunately, there are a few things you can do to help your money grow, without putting it at risk. This post will share the best strategies.
Inverse ETF and Short Selling
ETF stands for exchange-traded fund1, which is a system that allows you to profit from a decline. When the major indexes drop, your net-worth goes up! So how does this work? Essentially, you are buying derivative contracts such as “swaps.” These let you exchanges multiple underlying assets, which might mean trading with hundreds of stocks for instance.
Inverse ETF means that you are short selling a stock – expecting a decline in value and therefore repurchasing it at a lower price. Make sure that you know the difference between an ETN (exchange traded note) and ETF.
It’s also possible to short sell regular stocks and shares, but by combining the value of multiple shares, you are betting on larger market trends: such as the economic downturn that you see coming.
Of course, you can’t rely on the market plummeting either, but if you use this as part of a short-term hedge fund, and include it in a more diverse portfolio, then it can act as some assurance and help to ensure you continue making some profit no matter which way the tides swing.
Binary options trading basically means playing the stock market by making ‘binary’ decisions. Here you will look at the value of an asset and say whether it will go “up” or “down” by a certain date by calling or putting. As long as the value of the asset is higher or lower as you predicted by the agreed date, you then receive a set payout. Another type of binary trading is called “boundary options trading” wherein you receive your payout if the asset breaks a specific boundary2.
The great thing about binary options trading is that it’s simple to understand, it’s fast to play, and you know exactly how much you stand to earn and when. And this appeals to preppers for a couple of big reasons: firstly, it allows you to make a quick profit with no long-term investment necessary. Binary options are used by “day traders” who will often buy and sell shares in minutes, thereby profiting from tiny fluctuations and making a lot of money, very quickly.
Secondly, it once again means that you can bet against the market. You are profiting here from fluctuations in the market, rather than simply relying on it going up. This again means that you can put your pessimism to good use, and thereby bet against the market.
But in order to make money from binary options, you need to approach it with the right tactic just as you do with any type of trading.
When trading any kinds of assets, it makes sense to “spread your bets” by investing in different types. Invest in stocks for instance as well as precious metals and currencies. This way, you’ll be less likely to see all your options get hurt at the same time.
There are also various different types of binary options. Boundary binary options, call-put binary options and others like one-touch options. Try combining a few of these to see which works best for your particular trading strategy.
Another way that options trading can vary is in its time to expiration. 60 seconds binary options are options that expire in just 60 seconds, which is an exciting and fast way to make money. The downside of course is that it’s also a fast way to lose money.
Again, a good strategy is to mix and match. Have a few relatively ‘safe’ long term options that you know will keep you safe but then try a few faster 60 seconds options that have the potential to help you earn more money more quickly. That way, you can maximize your potential earnings without risking all of your money.
There are some types of business that are going to be resilient even in an economic crash. For example, you will often hear that commodities are a safe bet. Even in a doomsday scenario, certain supplies such as basic foods, gas, and oil will continue to be in demand. In fact, you could expect a serious event to cause gas and oil to soar.
If you are worrying about slightly less catastrophic events – like a good old-fashioned economic downturn – then you might also be wise to invest in gambling, and alcohol. Perhaps unsurprisingly, these are two types of business that actually prove to be somewhat resilient during times of economic hardship. When people are broke, they get desperate and try gambling. And when that doesn’t work… they turn to alcohol!
Trade the News
Trading the news means keeping up-to-date with current events and thus being able to better predict what the immediate future might look like. Knowing a little history even can help you to make smarter decisions.
The reason this is useful is that current events can very often impact on the value of various assets – especially if you’re trading forex but just as likely if you’re trading stocks and shares. Financial crises hurt assets across the board (almost – gambling companies and some other industries do well in a recession) while the news can also report on events specific to certain industries (such as the struggling supermarkets at the moment). All this information can help you to make a better judgement when deciding if a certain asset is likely to go up or down in the near future.
If you are someone who is fearful that things are only getting worse, then watching the news and looking for opportunities can be a great way to profit from that heightened sense of gloom!
Tangible assets include the likes of gold and silver, as well as jewelry, collectible coins, and the like. We’ve already discussed why these might be effective as binary options, but they are also one of the most popular long-term investment options for preppers.
You can prepare for your future using a gold IRA for instance, and in doing so, you know that your money isn’t being held in an abstract cyberspace vault. Rather, you have bought something solid and real that will always exist and that will always have at least SOME inherent value.
Gold gets its value from scarcity, meaning that until someone learns to print more of it, it’s always going to be a safe investment option!
Looking for more safe investment options? Check out the links below to get started and to invest wisely for all possible futures.