Investors who want to know where to invest in 2024 are in luck. The year has started sweetly in the markets. And equities are at record levels: US stocks are 5% above their previous maximum. In Europe, stocks are at their highest level in two years. In Asia, India is enjoying a multi-year boom and Japan’s stock market surpassed its 1989 peak.
Furthermore, in fixed income the rate increases carried out by central banks have raised the interest paid between 4 and 6%. “These figures offer a more than acceptable return compared to the risk,” according to Goldman Sachs analysts. In short, the markets seem to be doing relatively well and the situation should not change.
Where to invest in 2024? Index funds
An indispensable rule is that past returns are not future, which can apply now. After all, they can turn downward due to simple inertia, due to the effect of third parties such as central banks or due to anomalous events: such as a bubble about to burst or geopolitical confrontations.
However, the most likely thing today is that the markets will continue to rise, although perhaps not at the current pace. Behind that idea would be the strength of some large economies. Also the fall in inflation. And the subsequent lowering of rates that must come to accelerate the most depressed economies or alleviate the debt of companies.
Why choose index funds in 2024?
That last thing tells us that one of the best options to invest in 2024 is passive investment in its different variables. Among them, index funds stand out, since we can make a more global investment, through indexing to a global index. This also offers us diversification, which is now almost vital. The reason is that some of the conflict points of the moment can attack a market, for example, a bubble in technology or a more bitter conflict in Europe. However, we can overcome these setbacks better thanks to broader diversification.
ETFs, a good alternative in 2024
Index funds are a great opportunity, but ETFs are no less so. In this case, not only can you get that exposure to sustained growth with broad diversification, but you can also take advantage of some of its advantages. In particular, their high liquidity, since they function like shares, which makes it easier to buy and sell. Of course, keep in mind that precisely because of this characteristic, its taxation is somewhat more severe than in the case of funds, since if you go from ETF to ETF you must pay taxes for it, which does not happen with funds.
Where to invest in 2024? Bonds remain attractive
At the end of 2023, the bond market, that is, the fixed income market or the market in which all the debt products of companies and governments in the world are listed, lost some shine. The reason was that some central banks had the idea of starting to lower rates. The proposal started with the Federal Reserve (FED) in the US and continued to Europe, causing a drop in bond yields. However, months later these increases have been delayed and yields have risen, making bonds a good alternative for investors. And few assets earn between almost 4% and 6% and are as safe as bonds.
How many bonds are there?
If you think that fixed income is a better option, you should keep a couple of things in mind. The first and most important thing is that there are index funds or ETFs for this type of product, so you can combine their advantages. On the other hand, keep in mind that beyond the term and profitability, each one has its associated risks or has different characteristics. So that you understand it better, we explain the main ones:
- State bonds: this is the debt issued by the governments of each country and ranges from very short term (three months) to very long terms (such as 30 or 50 years). They tend to be the safest, although it depends on the country.
- Corporate bonds: is the debt issued by companies. In this case, the terms cannot reach a maximum of seven or 10 years. In this case, the risk is very fickle, since there are multinationals, solvent companies, but also others on the verge of bankruptcy. The ideal is to bet on the former, with exceptions.
- Green bonds: it is a hybrid between both, the issuers can be Governments, companies or international organizations, but all must meet the requirement that the money received must be used following environmental and socially responsible criteria.
Where to invest in 2024 with maximum peace of mind: Savings Portfolios
The last alternative is also the most conservative: savings portfolios, which are a type of account in which you deposit money and receive a fixed and assured remuneration. In addition, you have the possibility that whenever you want you can withdraw and deposit money and at the moment it is offering a profitability of more than 3%. The idea of this type of product is that it serves as a complement to the rest, so that we have there as an account in which our money enters and leaves towards other investment vehicles. With this, having high profitability at all times.
Wherever you invest in 2024, choose inbestMe
At the end of the day, chances are some of the products listed caught your eye. Don’t worry because it is not only normal, but desirable. After all, having our money in different products also helps us diversify and if we choose well it doesn’t have to be expensive. In this case, a great choice is InbestMe, an investment platform that has been operating in Spain since 2017, because there you can find all the opportunities mentioned at a low cost.
Furthermore, with InbestMe you can do it in a very comfortable way, since its perfected technology allows you to find the portfolio that best suits each profile and aligns with the objectives of each client. Therefore, it is best that you enter InbestMe and start looking at all its options, so that you do not miss the opportunity to increase your assets without worrying about anything else.
