Investing During a Recession
New reports detailing the financial gloom we live in are released everyday. Whether it’s updated unemployment figures, companies going bankrupt or political developments like the bank bailout, we live — as the Chinese would say — in “interesting times.”
So is a recession a best of times to invest — or the worst of times? I believe it is still possible to make those all important stock market profits despite the turmoil that fills the news.
One of the main ways to make stock market profits during the recession is to identify short-term downward pressures on stocks and commodities that have a light at the end of the tunnel, i.e. long term growth potential. Profits can be made from the stock market therefore by identifying companies, industries and commodities that will survive the recession relatively unscathed.
Another sure way to use the recession to your advantage, in a slightly nuanced way from above, is to identify areas that are likely to benefit from the economic downturn. Commodities are a good bet here; supply pressures often ensure that he dampened demand is more than outweighed in most cases. Apart from an initial dip, this has largely been the case with oil and a few other main commodities.
Specialized computer software is a must in such a volatile market environment. Software that performs thousands of quantitative calculation about the economic environment every second ensures that each qualitative decision you make is well informed by numbers, ensuring that stock market profits are safeguarded against that bit more.
To be sure, opportunities exist for stock market profits in virtually any economy. But profiting from the stock market is about forward thinking. In a recession, it relies upon long term investing and accurately finding under priced equities that have real staying power.
So is a recession a best of times to invest — or the worst of times? I believe it is still possible to make those all important stock market profits despite the turmoil that fills the news.
One of the main ways to make stock market profits during the recession is to identify short-term downward pressures on stocks and commodities that have a light at the end of the tunnel, i.e. long term growth potential. Profits can be made from the stock market therefore by identifying companies, industries and commodities that will survive the recession relatively unscathed.
Another sure way to use the recession to your advantage, in a slightly nuanced way from above, is to identify areas that are likely to benefit from the economic downturn. Commodities are a good bet here; supply pressures often ensure that he dampened demand is more than outweighed in most cases. Apart from an initial dip, this has largely been the case with oil and a few other main commodities.
Specialized computer software is a must in such a volatile market environment. Software that performs thousands of quantitative calculation about the economic environment every second ensures that each qualitative decision you make is well informed by numbers, ensuring that stock market profits are safeguarded against that bit more.
To be sure, opportunities exist for stock market profits in virtually any economy. But profiting from the stock market is about forward thinking. In a recession, it relies upon long term investing and accurately finding under priced equities that have real staying power.
