Where Do I Invest in a Recession?

It might seem counterintuitive to invest in a down economy but you are actually making a smart decision when you invest during the recession for many reasons. First, you are providing fresh capital to the economy, which will eventually rebound to your benefit.  Second, most stocks of good companies are down so you can buy them cheap, which means that you get great deals can sell them for a profit when the market turns higher.

The trick is in knowing which investments to place your money in. Fortunately, there are five good investments that are either guaranteed to return your investment plus earnings or proven to be stable even in a down economy.

Certificates of Deposit

With certificates of deposit, your principal investment is safe in the bank no matter the state of the economy.  You will earn interest on your investment at a fixed rate for a fixed period of time. Take note, however, that you must invest in certificates of deposit only with banks and credits unions with Federal Deposit Insurance Corporation and National Credit Union Administration insurance, respectively.

Tobacco and Alcohol Stocks

No matter the state of the economy, tobacco and alcohol consumption in many markets is stable.  In some markets, it can even increase especially in developing countries since manufacturers will turn their aggressive marketing tactics to countries where regulations are lax and where markets are still in their growth stages.  As such, tobacco and alcohol stocks – sin stocks, as most insiders call them – are excellent investments even in a recession.

Pharmaceutical Stocks

There are many reasons why pharmaceutical stocks are relatively stable in a recession.  For one thing, everybody will avail healthcare at some point and, hence will purchase medicines.  For another thing, the discovery of newer, better medicines are a constant factor in an! uncerta in world, which you might even say is an imperative need in man’s quest to attain immortality.  Thus, you can be sure that pharmaceutical stocks will stay on top of things even in an economic downturn.

Electric Utility Stocks

Electricity is a staple of modern life, of which its absence will cripple industries and countries.  As such, your investment in electricity-related companies will almost always yield good return on investments.  However, you must stick to two investments in electricity.  First, invest in established power companies with guarantees of return of investments as they expand their market bases.  Second, invest in companies engaged in power generation with extensive infrastructure investments since they have competitive advantage few others have at present.

Real Estate

With the nationwide trend in home foreclosures, now is the time to invest in real estate especially as it is a buyer’s market.  You can indeed buy desirable properties for seriously low prices, you can then sell at higher prices when it becomes a seller’s market.

Historically stocks still have the best return over the long term. But, some short-term stocks have great returns. Learn more at http://www.stock-trading-made-ez.com/.