If you are an average investor and want to invest money in an alternative investment like gold, silver or real estate don’t invest until you know the best investment form to invest in. Where you invest is crucial in 2011, 2012 and beyond because these alternative investments have become volatile. If the markets go against you you’ll want to be able to liquidate your investment quickly and easily.
A few years ago investing money in real estate, precious metals or other commodities was out of the question for most folks. These are called alternative investments, and there were two roadblocks if the average person wanted to invest money there. First, it was complicated and risky to play the commodities markets (and still is). Second, liquidity can be a major issue if you take ownership in the physical form. Have you ever tried to sell a property or silver coins in a hurry? Simply put, it can’t be done at a fair price. That’s called poor liquidity.
In 2011, 2012 and beyond you can invest money in these areas with excellent liquidity and simplicity. Your best investment alternative: exchange traded funds (ETFs). Let me use silver in 2011 as an example. If you held silver coins (rounds) going into 2009 or 2010, you watched prices soar through early 2011. It was probably the best investment around until May of 2011. As silver approached $50 an ounce it got hit hard and the price fell fast. If you wanted to take profits (liquidate) on your silver coins there was no quick and easy way to do it, so you probably did nothing.
Nobody knows where to invest money at all times to earn the best returns in terms of precious metals vs. stocks and bonds vs. real estate. But there is a best way for average investors to go about investing money in all of the above. In our silver example, an exchange traded fund with stock symbol (SLV) was probably your best investment. It is a fund that tracks the price of silver and trades as a stock. If you want to buy or sell you can do it any time (at market price) the stock market is open… on the internet… for a commission of about $10. That’s called liquidity, and all you need is an account with a major discount broker to play the game.
With exchange traded funds you can trade the markets, or you can invest money for the long term by putting together your own best investment portfolio that is both diversified and balanced. These funds offer average investors a broad spectrum of choices for 2011, 2012 and beyond. You are missing out on opportunity if you are only investing money in stock funds and bond funds. Put some alternative investments in your portfolio as well. The answer to where to invest in them: exchange traded funds.