Friday, August 24, 2018
How to Fund Your Retirement with Smart Investments
If you haven't been diligent about setting money aside for retirement, you probably aren't looking forward to its arrival. Instead of looking forward to the time you will have available to discover the best restaurants in town to frequent with your friends, the time you have available to pursue your favorite hobby, and the time you have available to travel to exotic places on your bucket list, you may have a quiet sense of desperation.
Fortunately, there is a solution: find smartways to invest. Some good investments will help you fund your retirement, and you might be surprised by the number of opportunities available in the financial markets when you know how to evaluate them, opportunities that, once seized, will help you retire in comfort after all.
Some interesting options to explore where you can enjoy the benefits of high leverage is the foreign exchange market, also known as FOREX; the equity market, also known as the stock market; or the futures market, also known as the commodities market. Let's take a closer look at each of these ways of earning the money you need for a great retirement.
The Foreign Exchange Market
The Foreign Exchange Market (FOREX), is the biggest financial market of all. It's daily transaction volume is in excess of $5 trillion. In fact, it’s bigger than the equity and futures market put together. This market is where traders buy, sell, exchange, and speculate on the world’s currencies. This financial market works based on the currency exchange rate. This exchange rate is quoted in pairs. For instance, if you wanted to profit from the difference in the currency exchange rate between the Euro and the US Dollar, you would look at the EUR/USD pair.
Still, if you are not interested in active trading in the forex market, you can buy an undervalued currency, hold on to it, and then sell it when the currency revalues. The IraqiDinar is a prime example. After the overthrow of Saddam Hussein, the value of the Iraqi currency plummeted. But since that time, the country has been aggressively pursuing a policy of economic redevelopment and now financial pundits expect an impressive revaluation. If you happen to have acquired large amounts of the currency, you'll make a handsome profit from selling it at the new price.
The Equity Market
The Equity Market, or the Stock Market, is an aggregation of people who want to buy stocks and people who want to sell them. Shareholders, of course, represent an ownership claim on a business. This may include privately traded securities and those listed on the public stock exchange.
If you want to buy a stock in a particular company, you should open a brokerage account that advertises low fees and offers a variety of useful features. Once you’ve opened up an account, choose your stocks, preferring companies that have demonstrated growth prospects over the long-term. The number of shares you buy, of course, will be based on your budget and your portfolio allocation strategy.
The Futures Market
The futures market, or the commodities market, is based on trading raw materials rather than manufactured products. So, for example, a soft commodity would be sugar, cocoa, wheat, fruit, or coffee. A hard commodity would be gold, silver, or oil. One way of trading commodities is to use afutures contract to hedge your position. If you expect, based on your understanding of technical charts and news reports, that the price of soybeans will go up by a certain date, you will make money if the price does indeed go up. The commodity market is similar to the other financial markets in terms of buying, selling, or trading, and it can be either a physical, virtual, or cyberspace.
When trading in FOREX or equity or futures, you must avoid a get-rich-quick mentality and never risk more money than you can afford to lose. Do your research and understand how currencies, stocks, or commodities move before you trade.
In conclusion, it’s never too late to enjoy a happy retirement. By making some smart decisions, decisions informed by research and backed with a robust strategy, you will be able to earn the money you need to enjoy a wonderful retirement.