Stock markets face de-escalation between euphoria and fear of a crash
FILE – In this Tuesday, March 23, 2021 file photo, the Fearless Girl statue stands in front of the New York Stock Exchange in New York’s Financial District. Stocks are off to a sluggish start on Wall Street as the market loses more momentum following its rise to records last week. The S&P 500 was wavering between small gains and losses in the early going Tuesday, April 13 while gains for several Big Tech stocks pushed the NASDAQ up 0.8%. (AP Photo/Mary Altaffer, File)
As well as impossible returns, it is necessary to avoid promises of pitch.
“It is important to be very clear about the difference between investing and speculating. Investing requires discipline, patience and conviction. Know very well what you are investing in to avoid unpleasant surprises”, explains El-As mar. Patience – Spaniards are lacking – translates into years. And in being serene in the falls. Experts advise clct stock the investment time to pay off, looking five, eight years ahead.
Another of the golden rules is to diversify.
Not all eggs in the same basket. Vary both in assets –stock market or debt–, as well as in sectors and geographical area. “Having a focus on a specific area is counterproductive,” warns Fuertes. It remains at the mercy of what happens in a specific sector or country.
The key is to combine.
“In any portfolio there should always be exposure to the growth of the stock markets, as well as a position in fixed income. The amount and type will depend on the investor and his circumstances”, point out Mario González and Álvaro Fernández, from Capital Group. At Rentamarkets they see an investment fund as the ideal vehicle, both for taxation and for the possibility of diversifying more easily.
Sustainability is one of the trends that can mark investment
Reviewed the bases, where should you invest? You have to keep an eye on the big trends. From green to the future of mobility. Fuertes bets on firms with a technological component. Not necessarily Amazon or Google, but a more traditional company digitizing the industry, such as a smart lock firm, exemplifies. In Schroder they also highlight sustainability: “it will become increasingly relevant in all areas of our lives”.
Once invested, reinvest is another rule. Periodic contributions without forgetting the long sights. “In the short term, no one really knows anything. If you can stay focused on the big long-term trends, and continue to invest in the good times and the bad times, you will have a much better chance of achieving your goals,” they say at Capital Group. In this way the nerve is diluted in case it has entered at a bad time and a better average price is achieved.
Advise and reassess
All experts agree that the ideal is to consult a professional before investing in the process. They can be the guide and the advice “in one of the most complex and volatile periods in the markets that history remembers”, they say in Schroders. “You will be able to better understand the needs and investment objectives of the person” and that the risk is “consistent” with your objectives and that you can assume, the Capital Group analysts point out