If recent stock news has you worried about your future, we’ve got you covered. Investing in stocks will always be accompanied by risk. After experiencing an unprecedented positive run, there’s bound to be a backslide. If you want to diversify your portfolio and move assets out of the stock market, here are three alternatives you can try your hand at.
Real Estate: REIT, Land, Digital. There are plenty of options under the real estate umbrella, and we could wax poetic for 20,000 words on the topic. Sparing you a lecture, here are a few to get started.
Real Estate Investment Trust (REIT) - Basically allows anybody to have partial ownership or a stake in real estate and development projects, without fronting the project themselves. Consider Public Storage PSA - a REIT whose focus is self-storage facilities. Americans can’t help themselves and continue to buy, even during a recession. Considering that, and that the housing market may lead some homeowners to downsize; the storage industry feels like a safe bet.
Another REIT to consider is Stag Industrial STAG. STAG has a dividend yield of about 4.5% and its model focuses on the acquisition of single-tenant industrial properties. With a focus on warehouse and distribution buildings, STAG could capitalize on the rising popularity of startup e-commerce shops and the necessary distribution associated.
Related: This REIT You've Probably Never Heard of Has Paid a Dividend Above 8% For The Last 5 Years
If you’re looking to avoid shared assets and want to own something for yourself, that’s almost certainly going to appreciate in value, look for land. Land is a finite resource and developers are always looking for an opportunity. Do your research on high-growth areas and valuable natural resources, and purchase accordingly.
NFTs: Infinite Object/ NBA Top Shot, UFC Strike, NFL All Day. A much less classic, and potentially more risky position would be investing in NFTs. This isn’t anything you should throw your entire portfolio into, but there is an opportunity for growth. You can decide on your own the legitimacy, long-term outlook, etc. But, facts are facts, and NBA Top Shot (by Dapper Labs) has produced. Despite crypto's precipitous fall in early 2022, NBA Top Shot grew 72% in January alone and had a valuation of $7.6 billion earlier this year.
Dapper Labs has launched the UFC and NFL version of NBA’s Top Shot recently. If you think you may be too late to the game with Top Shot, consider purchasing NFTs with UFC Strike (sport with the fastest rising popularity) and NFL All Day (America’s true pastime that can seemingly weather any negative news or publicity).
An interesting company to keep an eye out for is Infinite Objects. They’ve partnered with the NBA & Dapper Labs and have invented a product that lets you physically display or produce a ‘video print’ of your NFT.
Exchange Traded Fund (ETF): If you aren’t familiar with ETFs, they are a type of pooled investment security that acts similar to mutual funds. They track a particular sector, index, etc. but can still be bought and sold on a stock exchange. Buyer beware, the price will vary throughout the day, but they tend to be more cost-effective than mutual funds. If you’re disciplined, this may be the route for you.
There are multiple types of ETFs; Passive & Active, Bond, Stock, Currency, Inverse, Etc. What we want to focus on is Industry ETFs. Industry ETFs can be used to rotate in and out of sectors during economic cycles. The downside is limited because they don’t involve direct ownership of securities.
One Industry ETF quickly gaining popularity is Direxion’s mRNA focused ETF MSGR . Currently just below $15 the potential is obvious. mRNA technology may have been the impetus for Moderna’s meteoric rise. While that isn’t guaranteed to be the case, COVID showed us the use for mRNA and its potential has been widely discussed. Investing early in this ETF could have massive long-term upside. It should be noted, however, that the short-term may be rough. MSGR only has 21 holdings and dropped 40% since being listed in December of 2021. This is an ETF to explore if you believe in the science and the potential use of mRNA technology. If you’re a believer and act fast, you’ll be in incredibly early.
Regardless of your position, net worth, or available capital there is an opportunity for you to invest in something other than stocks. It’s important to keep your portfolio diversified to help mitigate risk. Losing money while investing is inevitable, but can also be minimized. Consider the options above to help balance your wealth, while the market is in flux.
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