To the joy of just over half the population, Obama won a second term as president. To the dismay of many in the financial industry, Obama won a second term. Whether you are excited or disappointed at the outcome of the latest election, the question is now where to put your money and still get the best return. Many people feel that there are certain sectors that will do well with the current administration, and some others that are best to stay away from.
One of the biggest goals of Obama’s first term was to push through the healthcare reform. The new laws open up many opportunities for the investor in the healthcare sector. There will be more money flowing through parts of the industry like pharmaceuticals and insurance companies. While many people feel that healthcare costs are going up for everyone; the investor sees opportunity.
Obama is a big proponent of alternative energy. But for the investor that is not the only place to invest. The latest drilling efforts in the Bakken Oil Fields have opened up a lot more oil that previously available. Oil, natural gas, and alternative forms of energy all have quite positive outlooks.
Tech stocks are usually considered risky. They have big returns, but they also have big drops when things crash. Regardless, technology is always moving forward. New innovations are being discovered constantly and getting in now with strong companies should provide years of healthy returns.
The housing market is starting to pick back up. That means more homes are being built. The construction industry is starting to boom, and barring another recession like the one we saw a few years ago, it should continue to gain momentum.
More and more people are moving from cash and checks to using credit cards. This trend should only keep progressing. Investing in these companies is as much a sure thing as you can get in the market. There is always some risk, but the future for credit card companies looks sound.
The stock market is a fickle place. The market can look great one day, but then a small bit of seemingly innocent news can make it plunge. People invest on emotions rather than logic. This causes huge swings in the market based on fear. People often pull their money from great investments, and rush to those that are not as good. We saw this with a large pullout a few years ago and many people flocking to gold. While generally considered a safe place, gold has become over-inflated and there are sure to be a number of disappointed investors. Likewise TIPS have become popular, but in periods of deflation they have a yield that is even less than the quarter percent you get at the bank.
There are no guarantees in the market. These sectors should be ones that do well, but there is always the chance that the company you choose could stumble. You should invest in what you know, instead of trying to learn a new industry. Branch out and spread your risk among more than one company and more than one sector. This will help you keep your losses to a minimum. There is some disagreement, but many financial professionals still believe that buy and hold is the best strategy.