What the Past Teaches Us?
When you look at the last 12 years there are certain truths that have been revealed and replaced former truths. Let’s begin with some of the former truths, first of all, over the past several decades one of the most talked about strategies was to Buy and Hold. This essentially meant that with real estate and with global stock markets particularly in the US and Europe, one would just buy a stock or real estate property that had a good balance sheet, a unique product base and room to grow and hold it for years until eventually realizing gains. From the 1940s to about 1999 the buy and hold formula worked extremely well with stocks and real estate and helped to build exponential wealth around the world. However with technology and globalization there also were “market bubbles” that formed particularly in stocks and real estate. The first big market shocking bubble was the tech bubble that burst at the end of the 90’s with wall street building up lots of Silicon valley stocks artificially and eventually there was a huge pull back as it was learned these companies were not as solid as was once thought. A couple years later in 2001 the 9/11 Terrorist attacks happened which again hurt stocks, nevertheless, the stock market and real estate market in particular began a strong value increase that was later seen to have been very superficial and not having a base as companies and consumers took on huge amounts of debt that had no possibility of ever being completely paid back and as such the real estate bubble and stock market bubble popped in 2008 and 2009 and sent recessionary shock waves throughout the planet. Although it is said that the recession is past, with commodity price increases that have affected food and fuel prices most of the population still feels like it is in a recession, or at the very least is not growing their income and net worth. So as you review the past 12 years and the events that have shaped our current economic situation it is difficult if not impossible to have confident in these old strategies of Buy and Hold and the now false truth that stocks and real estate will continuously increase in value.
Where Can You Capitalize in the Future
So as the realization that real estate and the global stock market have not led to positive returns overall over the past 12 years we must look to other alternative investments like Forex. One of the unique factors surrounding Forex is that whether the US Dollar is rising or decreasing in value versus the major world currencies like the Euro, Pound, Franc, Yen, or Australian or Canadian Dollar you can make money buying and selling the US Dollar. In other words it is possible to make money in an up or down market and best of all whether stocks or real estate values go up or down you can make money in any of those economic situations with Foreign Currency trade. That being the case you need to understand more about the unique features of Forex to take advantage of this market. Typically with mutual funds, Cd’s, bonds, and other investments you are locked in to those investments without the possibility of cashing out of them quickly, in fact it can take months to get your cash out of those investments and let’s not even talk about real estate which can sometimes take years in this current market to be able to get your cash out of the investment so how is Forex different? Well with Forex you have the freedom to withdraw all of your cash within usually a business day or two and have your funds back in your account. This is extremely beneficial in the case of an emergency. You basically can trade Forex one of two ways, first of all you can have a professional Forex Trading firm manage your account for you with any of their proven strategies and programs, secondly, you can try to trade Forex yourself. If you can dedicate several hours per week to develop your own trading strategies and take a few months to pass through some learning curves then trading yourself is a feasible options, however, if you cannot then you need to search for a Forex Trading firm with a solid performance history. Other investments that provide options similar to Forex are Futures and commodities which provide similar features to Forex. In any case you should at least diversify a portion of your portfolio with these asset groups.