We only have a few days to start a new stock market year and the truth is that it will not be an exercise for the interests of small and medium investors. Among other reasons why it is going to be the period in which it will foreseeably be raise interest rates in the zone. A monetary decision that undoubtedly will not sit well with investors in the equity markets. To the point that important corrections can be generated in the stock market at the time this important measure is executed.
On the other hand, we cannot forget that equities have not experienced a cut in prices of special intensity. And there is a rule that is always fulfilled in the equity markets is that nothing goes up forever, not even with respect to the rises. And it may be that this year is when this important change in trend is generated. This is one of the great fears that many of the equity market analysts point to. Something that can happen normally.
In any case, this year there will always be authentic business opportunities that you should undoubtedly take advantage of from now on. Channeled from various investment strategies and that you can carry out without any difficulty. While on the other hand, one of the keys to being successful in the stock market will consist of knowing enter equity markets at the right time. Although you have to wait a little longer in financial operations. So that you can make the savings profitable in a rational and balanced way.
Profit by diversifying
One of the keys to getting out alive this year when it comes to equity trading is to diversify your savings with particular care. Choosing the best financial assets at all times and that in any case will emerge in some of these months. One of the financial products that best interpret this investment strategy are undoubtedly investment funds. Especially in funds with active management, which are those that adapt to all scenarios in financial markets, even the most adverse.
Another aspect that you should take into account from now on is that which has to do with a selection of financial assets that are immersed in a clear upward trend. So that in this way, you can make profitable upward movements in a more or less short period of time. That is, with operations that are very short in duration so that changes in trend cannot affect you. If you follow this simple advice with great discipline, your operations will not have excessive distortions in the conformation of prices.
Go for the most lagging values
It is another simple system to apply that can fulfill your wishes in the equity markets. Beyond other considerations of a technical nature and perhaps also from the point of view of its fundamentals. While on the other, you cannot forget that this investment strategy carries more risk than other. Because they are the ones that can have the greatest appreciation power in the coming years, even in unfavorable scenarios for equity markets.
Within this general context, they may be the most receptive stocks to include in this year's investment portfolio. Because you have to keep in mind that nothing goes down forever, much less in these financial assets. To the extent that the trend change in stocks of the main financial assets. In some cases under great intensity in the conformation of these stock market movements. So that you can make profitable operations on the stock market in an optimal and satisfactory way.
The renewable sector
Within the sectors in the equity markets there is no doubt that this may be one of the positives in this new year. This is due to the fact that it is going to exert a very important buying pressure as a result of the interest on the part of a large part of the financial agents. Not in vain, in recent months a lot of money is coming into these values so it can be expected that the uploads will not take long to appear. With a potential for rises in the stock market that is above the other sectors that make up the equity markets.
While another part, it must also be emphasized that this business segment is one of the most expectations are creating among small and medium investors. In addition, they are already integrating the investment portfolios of financial intermediaries and thus be more influential in the decisions of retail investors. In any case, it is a sector that can undoubtedly become one of the great surprises for this year that is about to emerge. To the point that prices can escalate in these twelve months ahead of us to try to make the savings capital profitable.
Securities that pay dividends
Securities with dividends is one of the safest investment strategies for many small and medium investors with a more defensive or conservative profile. Because it is a very simple way to get an interest rate of up to 8% every year. Through a fixed and guaranteed payment, whatever happens in the equity markets. While on the other hand, it is a very effective strategy to improve the intermediation margins presented by banking and financial products, which barely exceed levels of around 1% or 2%.
On the other hand, it is also revealed that dividends are made up of a very simple strategy to create a stable savings exchange for the medium and long term. Beyond other considerations of a technical nature and perhaps also from the point of view of its fundamentals. In a few moments, like the current ones, where the cheaper price of money it is a reality in the euro zone. Where interest rates have been at 0% for several years. That is, without any value for the products intended for savings or investment.
Define the terms of permanence
For the short term, speculative cut values should be selected and that have a very wide fluctuation margin, that is, they are highly volatile between the maximum and minimum price of the session. This strategy is not recommended for a year of uncertainties such as 2020, therefore the smartest thing is to refrain from doing it. The risks of these operations are very high and therefore it is not advisable to carry out these operations in a period of so many and so many uncertainties like this that we are about to reach in a few weeks. There is no doubt that any mistake can be paid dearly from now on.
While on the contrary, for the medium or long term, companies with good management ratios should be chosen, and that generally their stock market oscillation is not very high. With the additional advantage that they reward the shareholder with the payment of annual dividends, with an intermediation margin that ranges between 3% and 7%. Therefore, it would be the best option to make contact with equities this year, due to its relationship between the concepts of risk and return. If not, it would be better to turn to other assets or financial products that are safer and guarantee a fixed interest throughout the year. As for example, fixed-term bank deposits.
Less business opportunities
Finally, it should also be noted so that small and medium investors can make a good decision that the general context of the equity markets is also decisive for operations this year. It should not be forgotten that after the equities have risen almost 60% since 2011It is logical to think that fewer buying opportunities may appear in the medium and long term, although always through a selective and cautious offer from companies that may have a positive behavior during the new trading year.
For this reason, all trades on the stock market should be carried out with greater caution. With the main objective of protecting against scenarios that are not very favorable for the interests of small and medium investors. Being one of the keys to the final result of the investments at the end of the year 2020. In which a balance will have to be made of all the movements that we have developed in this new trading year. In principle, the prospects are not positive at all, as we have pointed out in this article.