Fortunately, pandemics don't generally happen more than a few times every century. Because of that infrequency, it can be a daunting task to decide on a post-pandemic investing strategy. Undoubtedly, any safe financial approach would involve diversification. A portfolio with assets spread across many investments can keep a nest-egg safe from volatility. The only question now is what kind of strategy to employ?
As the world hopes to move past the COVID-19 pandemic, there are many concerns about how the "new normal" will impact the economy. Movie theatres, restaurants, and other mass gathering-based businesses might experience some initial customer reluctance, even after the all-clear. Other businesses may be impacted by the timeline of the eventual recovery from the economic impacts of the coronavirus. In addition to the recent election, there are several potential policies or impacts on consumer confidence that could cause the financial markets to shake.
Diversification protects investors from volatility by spreading the risks. However, it isn't always enough to invest in different stocks. For some investors, the key is to allocate funds to radically different funding mechanisms. Stocks, mutual funds, and bonds are all common investment tools, but there are many others.
Commodities such as gold or silver are also very popular investment tools. Gold, in particular, withstood the volatility of the 2008 market and has continued to grow in the decade since. Crude oil is another popular investment commodity. It is also possible to hold foreign currencies and other physical items such as works of art in the hopes of higher future market prices.
While there are many uncertainties ahead, for the foreseeable future, humans will always have to eat. Accordingly, investments in agriculture can potentially thrive during moments of questionable consumer confidence. With investments as small as $10,000, funders can purchase a stake in an agricultural operation. That opportunity creates a great counterbalance to the traditional stocks, bonds, and funds based portfolio.
None of us knows what will happen for certain or when, when it comes to the economy. That is why diversifying investments in radically different assets can be such a valuable part of preparing for the future. Using a balanced mix of stocks and bonds isn't always enough to protect a portfolio from the risks of uncertain markets. Agricultural investments can offer the flexibility of options without the relatively high cost of other assets, such as precious metals.
At the end of the day, investing in farmland also gives the funder the satisfaction of knowing that they are helping to feed humanity. Nothing is better than a financially sound investment that also contributes to making the world a better place.