Fear A Stock Market Crash?

Where Else to Invest Money Today

Fear A Stock Market Crash?
February 26, 2016

Did you spend the end of August anxiously watching financial channels and monitoring the huge drop in your stock values? Then go through it again in January? If you held on to your stock portfolio through those trying times, we hope your portfolio survived. However, if you are still popping antacids fearing another slide, you may want to look at alternative forms of investment.

The return on any investment is relative to its risk — higher return usually means higher risk. Over the long term, the stock market provides the highest returns, but you may be able to find suitable mixes of alternative investments that can bring you decent returns without the added heartburn. Here are a few options for your consideration.

  • Bonds – To have a balanced portfolio, you should already have some of your investments in bonds. Bonds provide a fixed-income alternative to riskier stocks, but by nature have limited growth. Within bonds, you can find a range from stable Treasury bonds to corporate or municipal bonds that provide different rates of return (and risk) depending on the creditworthiness of the issuer and the duration of the bonds. WARNING: Investing in high-yield, high-risk junk bonds could increase your Tums consumption.
  • Precious Metals – Gold and silver are the most common precious metal investments, but other rare metals used in industrial applications such as palladium and platinum are available. You can buy bullion or coins directly, or invest through exchange-traded funds (ETFs) that hold bullion and track the price. Prices of precious metals and stocks often move in opposite directions.

  • Commodities – There are a wide variety of commodities available for investment purposes, from grains and crude oil to common industrial metals like copper. Each commodity market has its own trends and peculiarities to study before investing.

You can invest directly through a brokerage or via ETFs that track particular commodities. You can also consider futures trading, where you agree to buy or sell a particular quantity of a commodity at a specific price. By using leverage (effectively borrowing money to deal in larger quantities), you can see large returns — or large losses. If the risk and volatility of the stock market is enough to concern you, commodity futures may not be a better choice.

  • Real Estate – Investments in real estate can take several forms. You can buy rental homes and make your money from rent payments, if you are willing to deal with the management issues of being a landlord or pay a management company to handle it for you. Another possibility is to join a real estate investment group to spread out the costs.

Real estate investment trusts (REITs) are an excellent choice if you want to invest in real estate but do not have large amounts to invest. REITs are a style of security that invests in real estate using pooled funds from investors, either in commercial or residential properties. REITs can either hold mortgages or make money via rent. The nice thing about REITs is that they can be traded in a method similar to stocks and have a great long-term track record of high returns — around 13% per year on average over the last forty years.

Why worry yourself sick over the stock market when you have options? Review any interesting alternatives in detail and balance your tolerance for that form of risk versus the historical and potential rewards. Invest appropriately based on your findings, then sit back and relax knowing you have done your best. Life is too short to worry about investments and its heartburn.

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  Conversation   |   11 Comments

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Nancy | 02.26.16 @ 18:01
I am not a person who enjoyed my endeavor into the stock market. I would prefer to invest in land and property.
Steffanie | 02.26.16 @ 18:01
I don't worry about investments at all. I let everyone else do that. This article has some great information that I will be sharing with my dad. Thanks
Carla | 02.26.16 @ 18:02
Call me gunshy, but I am always waiting on the stock market to crash. Always make sure you have reputable people handling your money and keeping you informed.
Tina | 02.26.16 @ 18:04
This is why I let professionals handle that aspect of my finances, so I don't have to constantly worry about it. As Dave Ramsey says, when the stock market crashes, stocks are on sale! Buy them and wait for it to recover, as history indicates it will.
Sara | 02.26.16 @ 18:04
I do not invest because well I am always afraid of it. But would not be surprised if it did crash.
Brittany | 02.26.16 @ 18:04
That's always been something I've worried about when it comes to investing, is the possibility of another crash
Alec | 02.26.16 @ 18:04
I don't invest but I know several people who do. I know someone who invested money in a house that was worth more than they paid, someone who plays the stock market and buys land. They're all sitting back and watching as the value of their property goes up, but I'm not sure how the stocks are doing since I'm not privy to the specific investment. I'd personally invest in land before anything else since there is only so much of it and it can always be useful.
irene | 02.26.16 @ 18:04
Great info, even my husbands Annuity fund in the stable value option has lost a few thousand dollars, this sounds like a great idea
Kamie | 02.26.16 @ 18:05
There are many ways here to invest your money in and make money back on, I guess for a person it all depends on what exactly you are more comfortable in investing your money in. I am already in stocks, and have looked into precious metals.
Kailie | 02.26.16 @ 18:06
Stock market and investing in those kinds of things has always kind of worried me. Some of the listed reasons are good about that.
Erin | 02.26.16 @ 18:07
Thank you for sharing the different options that are available for those who worry about investments. I leave all of that up to others, but this is good advice for those that are really interested.
$commenter.renderDisplayableName() | 01.22.21 @ 16:18