Diversifying your stock portfolio can be a great idea to reduce volatility and risk in turmoil market conditions. We have recently ended a huge bull run in the equities market, so people are now considering diversifying into other assets such as alternative investments. Alternative investments are assets you can buy outside of the stock market such as gold, real estate, bitcoin, and Merchant Cash Advances (MCA). Regardless of which you choose, you will have exposure to markets outside of stocks which is great for turbulent conditions like we are currently in.
Why You Should Diversify
The idea is that these alternative investments will perform well when the stock market is doing bad which can help protect your capital. The U.S. stock market has always been the go-to investment for most people, especially with their 401k. However, the stock market still has years where it produces negative returns while other alternative assets lead the charge in performance. For this reason, it can benefit you to diversify your portfolio to reduce volatility especially if you are nearing retirement. In addition, certain alternative investments like Merchant Cash Advances can provide cash flow each week without forcing you to sell stocks or Bitcoin to be able to use your profits if necessary.
Benefits of Diversification
The stock market is a wonderful investment, but this does not mean it can’t provide negative returns on certain occasions. The markets are also volatile, meaning your portfolio value can constantly be changing, making it hard for you to look at on the bad days. As you know, cash flow is king, hence investments that provide steady cash flow are amazing to have when the stock market is not doing well.
It is good to diversify your wealth into alternative investments that can act as a hedge for the bad times. Real estate is an amazing choice, especially if you go with the rental route because you will build equity and generate cash flow each month. Buildings are physical and will always be in demand, making real estate a great alternative investment. Buying physical metals like gold is beneficial because it is tangible and can even be traded for goods or cash without the need for the internet, and Bitcoin can offer better returns. However, real estate and Bitcoin can be just as volatile as the stock market and real estate will definitively take up a lot of your time, with Bitcoin and gold you will probably have to deal with fees to buy and sell, and you need to invest in security for your gold bars/coins. An amazing alternative to those options is the MCA industry because it provides steady cash flow without any market volatility and high yield in short time. In addition to the lack of volatility, cash flow and high yield there is practically no time requirement to invest in the MCA industry. Disruptive MCA’s investing program is an amazing opportunity to become a part of this growing industry