The US government might have narrowly avoided a major economic crisis, but that doesn’t mean it’s smooth sailing. With the atmosphere of uncertainty
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Forbes Money US Default Looks To Be Avoided At Eleventh Hour - Here’s What Investors Should Know
As the US government reaches a deal in principle to raise the debt ceiling and avoid default, investors are turning their attention to what this means for their portfolios. To mitigate the risk of any investment portfolio, diversification is key. A diverse portfolio should include a mix of large- and small-cap domestic stocks, corporate bonds, international stocks, government bonds, real estate, and cash. Index funds and exchange traded funds (ETFs) offer partial ownership of assets in the index and are good for long-term investments.
Investors should also consider investing internationally, as stock markets and economies in places like Europe and Asia often move differently. While big global events can have an impact on markets worldwide, markets typically don’t rise and fall at the same rate around the world. Additionally, emerging markets carry some significant risks not present in developed ones, so it’s important to be aware of these before investing.
There might not be anything that’s totally recession-proof, but there are certainly assets less prone to the effects of a recession. Johnson & Johnson (JNJ), Procter & Gamble Co (PG), and Duke Energy Corporation (DUK) are all examples of recession-resistant stocks. JNJ has a long history of steady performance through economic cycles, while PG and DUK make goods and provide services that households shop for even in lean times.
It’s important to remember that there is no sure-fire way to avoid risk altogether. However, by investing in stable, value stocks and diversifying across companies, industries, sectors, market cap, and asset classes, investors can minimize risk and benefit from long-term investments. With the help of AI-powered investment strategies, such as Q.ai’s Value Vault Kit, investors can make informed decisions and build a portfolio that will withstand the test of time.
