Expanding And Growing Your Investment Portfolio: 3 Guaranteed Strategies To Try Right Now

In the past year, one thing has become clear: more Americans are prioritizing financial health. Americans are saving more than ever before, and a record number of consumers are invested in the stock market. Younger Americans have been busy creating financial security and independence by building diverse investment portfolios. If the year 2020 has taught investors anything, it has been the importance of building a diverse and resilient investment portfolio. However, for a new investor, learning how to invest in stocks and expanding your portfolio can seem daunting at first. If you are considering broadening your investment reach, here are a handful of tips to help you get off on the best foot for 2021.

Decreasing Mortgage Rates And Real Estate Prices Means It Is The Perfect Time To Capitalize

Investing in raw land has great potential, and can be a great inclusion if you are looking to add hands-off investment options to your portfolio. The pandemic is expected to have a huge impact on the real estate market. According to Bloomberg, commercial real estate prices have declined drastically, and U.S. mortgage rates have hit record lows, which presents the perfect opportunity for any investor to add real estate to their stock.

Agricultural land has also shown itself to be a stable investment in the last year. According to USDA’s 2020 Land Values report, the average value of agricultural cropland remained relatively stable from 2019, while cash rental rates declined only $1 per acre, signaling stable returns if you choose to rent your land. States with land for sale like Texas and Arizona are also ideal for investors looking for good returns on their capital. Arizona land prices are some of the lowest on the market, while recent reports from Texas realtors have shown that the price per acre in Texas increased by 7.32 percent to $6,232 per acre, making it a profitable investment to buy and hold.

With Hope In Sight, Travel And Hospitality Stocks Are Set To Rebound In The Long Term

Sectors in the travel and hospitality industry have been some of the hardest hit during the pandemic. However, they are also the sectors set to experience one of the largest rebounds in the coming months. With vaccinations announced and vaccination plans being rolled out, experts are turning their attention to the post-pandemic period when demand returns. This makes it the perfect time to buy into the travel or restaurant stock market before demand begins to skyrocket. Banking giant Barclays has backed travel’s recovery, and the commercial aerospace market is also expected to recover in the coming months. While the returns won’t be instant, it is a good option for those willing to wait out the remaining turbulence.

Reduce The Risk Of Volatility With Index Funds

The increased risk of researching, choosing and investing in individual stocks can be off-putting for many investors, experienced or inexperienced. If you are looking for an investment with less work and risk, index funds may be the answer. This is particularly useful for novice investors or those who do not follow the market religiously.

So how do you choose an index fund to invest in? Start with deciding the kind of investment you want to add to your portfolio. If you are after long-term growth (perhaps for retirement or college education funds), then you are better off choosing a fund with a wider portfolio of stocks. If you are interested in a specific sector like healthcare or fintech, take a look at their tracking error history. Finally, remember to consider the expense ratio when computing your total returns.

If you are seeking diversification but short term returns, some options can include money market funds. They provide a better return over cash savings, but come with a cost if you want to cash out. There is no set solution to expanding your investment portfolio. In fact, there are probably over a thousand different ways to do so. Your choice of diversification will depend on your risk appetite, income reach, and preference.