Should you invest in shares at the moment?

To buy or not to buy, that is the question. 

Many of you may be wondering whether to invest in stocks and shares amid the coronavirus crisis or not. As always, there’re different opinions on the issue, and the first thing to do is your personal research. It’s obvious that during the pandemic most travel and entertainment industries had to bear large losses. On the contrary, pharmaceutical companies, for example, were more than happy to make a profit from the situation.

So, there’s a big secret you need to know: no one can be sure whether the stock market is going to crash in 2021 or not. Yes, that hurts but that’s the truth.

After a significant drop in the value of stocks at the start of the Covid-19 pandemic, stocks have risen. Unfortunately, there’re reasons to think that commodity booms were the reason for that. So, the stock price increase is much more than the growth of the economic sector. As the pandemic situation remains unstable, there’s always the possibility for a decline in equity values.

However, despite the uncertainty, there’s still hope of brighter days for stock markets. Here are some reasons for such optimistic thoughts:

1. More and more people will get vaccinated, which will decrease the number of coronavirus cases in the world and will lead to the opening of borders. As a result, most of the closed companies will reopen;
2. New industries have thrived and will continue to grow, so they’re fresh possibilities for investment;
3. Takeovers will continue;
4. As long as interest rates remain low, there will be a tendency to spend or invest, as it’s more profitable than keeping your money in deposits at banks.

Pieces of advice for investing during uncertain times

Stock markets during the pandemic are unstable, so there’s something you need to know before starting investing:

1. Choose wisely. Learn all the information about the company you want to invest in, and only after that make your decision. Play around with a handy ISA calculator to get an idea of how your investment could grow over time.;
2. Don’t forget about volatility. During the pandemic (read unstable times) volatility can be extra high;
3. Think your own thoughts. There will always be a “but”. “Yes, I want to invest but Covid-19 / but people are fearful / but what if I lose my money and so on”. Nobody is insured against risk, you either accept this or give it up.
4. Don’t invest all your money in one stock, buy several, or, better, invest in a fund. Thus, you reduce the risk of losing everything.
5. Take it slow. Don’t invest everything you have. Make a plan and add a fixed amount of money every month;
6. Base your decision on how quickly you will need the money.

What fields to invest in 2021

If you decide to invest, reread our first advice once again – choose wisely. There’re some fields in which you can invest to minimize the risks.

Covid-19 boosted eCommerce. Because of various pandemic restrictions, people had to buy everything on the Internet, and they liked it. Who would want to stand up from the sofa and go shopping when you can go shopping while actually lying on the sofa. With or without Covid-19, eCommerce is likely to continue to develop.

Another pandemic gift was free time. People didn’t know how to spend it and tried online gaming, which has been trending in recent years.

Speaking about trends, we cannot but mention renewable energy. We all want to make our world a better place, so this is one of the steps to achieve the goal.

Fintech companies aim to make people’s lives easier and give them more possibilities. Such companies reach a big number of users, involving less investment. So, take a look at this field as well.

Keep calm and invest (or not)

There’re no certain rules that will tell you what to do. Life is hard and we have to make decisions every day.

In the Orca app you can find cool LSE stocks, learn some statistics about companies and read educational articles that will help you choose wisely.

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Disclaimer:

Orca does not provide investment advice. If a customer has any doubts,  they need to contact an investment adviser. Terms and conditions apply. Your Capital is at Risk.

Orca is an appointed representative of RiskSave Technologies Ltd, which is authorised and regulated by the Financial Conduct Authority (FRN 775330).