What Are the Best, Post-Election Investment Vehicles

While Donald Trump’s surprise election victory may have taken the financial markets by storm, the initial burst of volatility that gripped the Dow Jones and S&P quickly subsided within 24 hours of Hilary Clinton’s muted concession. This does not mean that volatility will not return to the global markets once Trump is unveiled in the Oval Office on January 20th, 2017, however, while Trump’s unique standing as a businessman rather than a politician means that the economy will head into uncharted and uncertain territory under his stewardship.

3 of the Best Post-Election Investment Models

This is no help to investors, of course, who must look to negate the uncertain climate and continue to trade profitably. With this in mind, here are three of the best post-election investment vehicles that are worth considering: –

  1. High Value Stocks Such as Apple

As a billionaire and global real estate tycoon, it is little surprise that Trump is committed to reducing the impact of corporation tax on American businesses. Under his relatively vague and yet-to-be-confirmed plan, no company of any size would pay more than 15% of their total income in taxes, creating the single largest revolution since the tenure of Regan.

Not only would this discourage firms from deferring their taxes abroad, but it would also earmark high value stocks such as Apple and Google as viable investment options. Even dividend investment would become more lucrative, with blue chip companies like Coca Cola likely to experience consider share price hikes as a result.

  1. Global Stock and Bond Index Funds

If there is one thing that investment management firms constantly preach, it is the importance of diversification. This not only applies to the assets an derivatives that you back, however, as Trump’s election win may also herald a unique opportunity expand into global stock and bond index funds.

Despite Trump’s apparent stance against globalisation, this is a process that will continue throughout the US and incorporating international funds such as the iShares Global 100 ETF can help you to capitalise on this. This will deliver both short and long-term gains, which is a considerable benefit in such an uncertain marketplace.

  1. Corporate Bonds

With the stock market likely to continue to suffer from at least some form of short-term volatility, you may also want to turn your attention to the safe haven of corporate bonds in 2017. These assets always tend to perform well when stocks are declining, while they offer a genuinely secure source of wealth that are ideal for long-term investment plans. Make sure you know what to expect from these bonds though. A good law firm, such as Withers Worldwide, will provide advice on which bonds you are eligible to buy, as well as what to do if you feel a company has not kept their side of the deal. Bonds don’t always pay big, but they can provide you with stable growth over several years.

Make no mistake; a five year corporate bond will add considerable depth to your portfolio and help to secure your capital during Trump’s inauguration. This is a key consideration, particularly as there are still considerable gaps in knowledge concerning the incoming President’s precise manifesto and economic plan.

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Planning Is Essential if You Are to Grow Your Assets

For many years it was thought that buying real estate was the best way for an ordinary working family to build up their wealth. It is too simplistic to say that people 30 or 40 years ago bought real estate which is now worth many times more than their purchase price. The best way to look at home ownership is to look at what percentage of their income at the time was needed to fund the purchase and the ongoing monthly mortgage costs. Having said that owning a home means no rent. The bottom line is the calculation on owning real estate involves more than simple figures on a piece of paper.

Real Estate

In recent years the recession has called into question whether it is worth taking a risk with investing in real estate, perhaps being overly optimistic on buying something that it is difficult to afford. Recessions occur periodically but in general families can expect the value of their properties to grow. It is a medium to long term exercise to grow an asset and in the situation when many people approaching retirement have such limited funds set aside that asset growth may be needed to provide a comfortable retirement.

Demands on Your Pay Check

The problem that many of the younger working generations face these days is they are struggling to meet their current financial commitments and therefore find it difficult to save the necessary deposit. Those starting out on a career find so many demands on their pay check. Student loans are an obvious problem and graduates who used a credit card to fund their student lifestyle often have expensive card balances to handle. Even being able to pay the monthly minimum that is required stretches finances. If this is your problem then a word of advice; get a cheaper personal loan at a cheaper rate of interest, get rid of that balance by using the urgent loan to pay it off and only use the card in the future when you can afford to pay the month end balance in full.

The point is that you cannot spend your time balancing your debts and save the money you need to get a deposit for real estate. Equally you will struggle to invest for the future anyway and certainly not be able to get the money together to have an emergency fund unless you understand financial management and have the self-discipline to follow a budget.

Those who leave home for a new city to start their careers face the prospect of finding somewhere to live; it will cost money even if it is shared accommodation. Perhaps you are luckier? If you can live at home and your parents understand that you are saving for your own place then your monthly expenditure may be far less than your friends who have significant rent to pay.

Living at Home

In the USA today it seems that an increasing number of people, even up to the age of 35, are living at home rather than moving out. The important thing is that if you have the chance to live at home that you use your money wisely; don’t spend everything you earn on things you don’t need. Devise a saving strategy with a clear idea of what you are aiming for financially.

No one teaches financial management at school and unfortunately some people learn the hard way. Investing in general is an alien concept on those in their 20s, even their 30s because they often have a problem identifying spare money that they can use. Alternatively they think that if they have a specific amount in the bank then they can spend it all before the next pay check comes in.

Budget

Don’t fool yourself into thinking that there is no point in saving because with interest rates so low there is no real growth available. You need to look beyond the very short term. Once you decide to live by a sensible budget you can expect to have a surplus to use for a few things that will potentially help your financial future:

  • Saving towards a deposit for real estate.
  • Accumulating an emergency fund, ideally a minimum of three months regular expenditure
  • Investing so that you have the chance of building up a retirement fund that will provide for comfortable retirement

In many ways these things are interlinked. Unless you understand the importance of planning for the future you have little chance of owning real estate and ultimately building up the assets to provide a comfortable future.

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10 Principles Of Psychology You Can Use To Improve Your Online Trading

When trading in financial products there are quite a few things which must be kept in mind. First and foremost, understanding the basics of the trading is the most important. if you are into forex trading, then understanding the basics of various currencies is the first starting point. Without this being in place it would not be advisable to get into the market. The same is the case with commodities, stocks and shares. Each one has its own uniqueness and special features which must be taken into account.

There are some basic rules and regulations to trading which must be followed irrespective of the product that is being dealt. Further understanding the psyche behind CFD is something which we must all understand. We will look at 10 such tips which could help our CFD trading from the psychological points of view.

  1. Fear

Fear of losing is one of the biggest psychological factors which make many people stay indoors as far as CFD is concerned. They fear the transition from demo account to real money and this should be overcome.

  1. Greed

Being greedy is another big psychological attribute which you should control when it comes to trading in CFDs. It could lead to overtrading and getting into the market at the wrong time and should be avoided at all costs. Correcting this psychological attribute is of paramount importance.

  1. Stress

Stress is another factor which could lead to wrong decisions being made. Hence when you enter this market you must be in the right frame of mind mentally. Having some problem in the background could create more problems than solutions.

  1. Anger

You could have had a bad day in the trading and would be seething inside. When you enter the market the next session of the next day, it would be wrong to carry over the anger forward. This would lead you to desperation and in nine out of ten cases you will end up making mistakes.

  1. Joy

It is quite possible that a particular day you could have made a big profit and you could be in a state of euphoria and joy. As a mature CFD investor, you must understand that the each day is new and unique. Hence, it would be wrong to carry forward the euphoric state of mind to the next trading session. This is what reputed service providers like CMC Markets teach their clients.

  1. Being Patient

Rome wasn’t built in a day. Hence it is important to understand the virtue of being patient as far as your CFD transactions are concerned. You have to perfect the art of entry and this not happen in a day or two. It could take a few months and you may have to go through many demo sessions. Only after being reasonably sure about the demo sessions should you get into the live scenario. The more patient you are, the more would be the prospect of making money.

  1. Learn To Stay Calm And Composed

Being overtly euphoric or getting unnecessarily tensed up should be avoided at all points of time. If you are calm and composed, you will be able to come out with a concrete plan of action for the session. You are less likely to be driven by gut feelings, sentiments and emotions and will trade based on logic and ground realities.

  1. Learning To Be Decisive

Another big reason why people end up losing money in CFDs is because they are not as decisive as they should be. If you decide to enter a market your decision should be firm and not wavering. The same is the case when you decide to exit the market.

  1. Learn To Trade In Right Sizes

Another psychological barrier is your inability to choose the right size of trading. It should neither be too big nor too small. This comes with knowledge and also with your ability to keep psychological and emotional factors away from such trading decisions.

  1. Keep Sentiments Away

At the end of the day there is no denying the fact that you must act based on facts and figures alone and should avoid bringing in sentiments because of obvious reasons.

Hence at the end of the day keeping one’s psychological factors in check and making good use of them could lead to success in CFD trading.

 

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