The sudden onset of the coronavirus pandemic caused a strong hit to the stock market and job market and forced many of us to reassess our finances quickly. Even as we cautiously progress back to normalcy this summer, the virus is still very much a threat thus making investors and the market wary of a second wave.
While the pandemic brought a mass of uncertainty, there’s also a lot we can learn from it to be safe with our money in the future. Stocks have dropped in the midst of the global lockdowns and Americans have experienced the importance of having money saved. Big companies who suffered from the closure of their stores and from reduced spending on material items, such as Apple and Nike, are smart investments since their stock will eventually grow from pent-up consumer demand once the pandemic fades. Reliance on technology has grown from the new normal of working from home and staying indoors, so demand for Netflix and Amazon will only grow as more resources shift to a digital space. If you’re thinking of investing, reflect on whether the companies you’re investing in can still survive a sudden change in normalcy, such as this pandemic, and can eventually recover their losses afterwards. Find companies that are consistent but typically remain under the radar. Adobe, for example, is a staple in workplaces that won’t be going away anytime soon.
Once coronavirus gripped America, there was a noticeable spike in balance of savings accounts, a positive change compared to research that Americans are bad at saving. With stimulus money and additional unemployment benefits, we’re learning why it’s important to save the money we have access to due to uncertainty of the future. The same idea goes with investing in that you should never day-trade with money you’re afraid to lose and to not invest it all in one stock.
Take into account the stock that will gain a big pay-off from the pandemic. Zoom and Instacart certainly fit in this trend, as well as Chegg. There’s a risk that this trend may not remain positive so be smart with how you want to take chances with your money. However you’re looking to invest, it’s essential to do proper research on what you’re investing in and your own finances.