Why it is Important to Diversify Your Investments in 2021

Why it is Important to Diversify Your Investments in 2021

Show Me the Money: Diversify Your Investments

If you’re reading this in 2020, you’re probably well aware that diversity is a good thing and that’s the case when it comes to investing your money.

Remember that iconic moment in Jerry Maguire when he says show me the money? Well, we’re about to show you how exploring alternative investments beyond the stock market can help grow your financial return.

Take Risks, Be Smart

Let’s be real. We can’t all be Warren Buffet but with 11% returns annually, the stock market can be a great way to build wealth over time. But if you were one of the unlucky millions of people affected by the 2008 stock market crash, you already know that the stock market can be risky.

Those of us who have 401K plans, pensions, trust funds (Cher Horowitz we’re looking at you) or use apps like acorn to make small investments are more exposed than they realize to the whims of the stock market.

The good news is, you won’t have to become an Instagram influencer or YouTuber to make some extra cash, thanks to alternative investments like real estate, venture capital, commodities and private equity.

Stability is a Good Thing: Alternative Investments

If you paid attention in tenth grade physics you know that what goes up must go down and Newton’s Law typically applies to the stock market as well. Sometimes taking the risk is worth it, but sometimes it’s not.

Alternative investments can help you avoid the unpredictable nature of the stock market while providing potentially attractive returns. If the stock market unexpectedly takes a turn for the worse, alternative investments are not usually affected.

The bottom line is, don’t put your eggs in one basket because like the stock market and investments in general, one fall and the egg container crashes, leaving you with a big financial mess to clean up.

Each person’s financial portfolio is different and requires its own unique approach. Creating a diverse investment plan which combines traditional stocks and alternative investments can help you benefit from growth in the stock market, but also offer you stable returns when the stock mark isn’t in the best shape. We could all use a little more stability in the personal and financial areas of our lives.

So now that your side hustle is up and running, your next challenge is figuring out how to spend all that money!

Have questions about investing with MWMfund? Reach out to us at hello@mwmfund.com.

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