The troublesome economic situation in our country, aggravated by the end of 2014, allows us to conclude that the crisis has intensified in the new 2015 year. This forecast is supported by the opinions of both Russian and Western experts.
As part of the accelerated fall in the national currency, by the end of last year, many had wondered where to invest in Russia with the greatest possible benefit or how to preserve existing savings when banks “packs” close.
The main causes of the Russian economic crisis
There are at least five of them:
- The critical situation in Ukraine, which led to a decrease in a number of economic indicators, and growing corruption cause an accelerated outflow of capital (according to many experts, this will continue in the coming year 2015).
- Sanctions put forward by the Eurozone, Australia, the USA, Canada and other countries.
- The decline in Russia's competitiveness due to the outflow of foreign investment due to the above sanctions.
- Direct dependence on oil prices.
- The fall of the national currency and the inflation of interest rates of the Central Bank due to capital flight.
Current forecasts of the development of the Russian economy relative to 2015
The aforementioned causes of the economic crisis in our country inspire very disappointing forecasts of its further development, as a result of which the issue of where it is more profitable to invest money this year is becoming more and more urgent. The accelerated fall in national currency at the end of last year makes even famous leading economists think.
Forecast by V. Osakovsky (specialist at the American bank Merrill Lynch): the Russian economy will continue to remain in recession until the 2nd quarter of 2015. It predicts zero ruble growth this year. Inflation, in his opinion, will rise to the level of 8% by the 1st quarter of 2015. In this regard, the Central Bank’s rates will rise in the 4th quarter. The result of all this is a decrease in the number of credit programs and a drop in the income of the (real) population. However, already in the second half of this year, there will be a strengthening of economic growth trends due to increased government spending, in particular for the construction of the Crimean bridge and the construction of a gas pipeline to China, as well as a reduction in imports. The further outcome depends on whether there will be a de-escalation of the Ukrainian crisis or its resumption.
Forecast by D. Nell and A. Slyusarchuk (economists of a large American banking holding Morgan Stanley): economic recession in 2015 by 0.5%, reduction in investment, consumption, accelerated inflation. This will lead to an increase in Central Bank rates up to the second half of this year. They also note the dependence of further economic development on the outcome of the crisis in Ukraine. If escalation continues, rates will rise, and Russia will go into recession up to 1.5%.
Forecast of the Ministry of Economic Development: economic growth this year by 1%.
As for Western financial and economic institutions, they have different opinions on the further development of the economic situation in Russia.
Forecast FocusEconomics: economic growth in 2015 at 1%. And the financial and economic news agency Bloomberg estimates that 1.15% growth will be observed this year.
Forecast of Danske Bank, BNP Paribas and Swedbank: two-year recession with a special burden for the current year (decline 0.6–3%).
Where can I invest in the current economic situation?
The main areas of investment:
- Foreign exchange market (an impressive risk of inflation, even when storing cash). If you still want to invest in this investment tool, then you should choose the most stable currency (euro, Swiss franc, dollar). Investing in the ruble is now more than risky.
- You can invest in real estate. Investing in commercial facilities, housing, construction has always, so to speak, been in demand. However, it should be remembered that during a crisis, real estate can easily fall in price by at least 50%. Therefore, it is more efficient to invest in real estate in still developing cities.
- Deposits for the preservation and increase of money. Their first assignment is more in demand, since investing money at interest will be inefficient due to minimum rates. With an unfavorable outcome, they will not cover losses. However, if you nevertheless decided to invest at interest, then the following recommendations should be observed:
● you need to trust only reliable banks;
● choose deposits that provide the possibility of partial or full withdrawal of funds without losing the accrued interest;
● it is worth investing in several banking institutions at once, with each deposit up to 700 thousand rubles. due to the fact that the insurance agency guarantees the safety of the amount not exceeding 700 thousand rubles.
- Antiques, art objects. This is recognized as the most reliable tool for investing in times of crisis. If there is any doubt as to whether it is worth investing here, you can reassure yourself that such investments are considered one of the most profitable and reliable investment tools. This contribution will help protect funds and significantly increase them.
- Precious metals. This is a rather risky option as to where to invest money (investments), because the gold exchange rate always fluctuates (as at present). The situation is similar with silver. Palladium is considered the most stable.
- Mutual funds (a very risky investment tool). It is worth recalling the situation with the collapse of stock markets (2008-2009). Many believe that this situation may happen at the present time, so this is not the option where it is better to invest money.
- Own business. Experts advise to refrain from this type of investment in the current crisis situation. If, nevertheless, a decision has been made regarding what to invest in, and this is your own business, then you should focus on essential goods and services (provided that there is no segment congestion).
- Stocks (requires special knowledge to manage your existing investment portfolio). In an unstable economic situation in the country, they can bring substantial income with proper management.
- Exchange speculation. This is a good option as to where it is better to invest money (especially in times of crisis, when the jumps in quotes are quite impressive). However, at this time it is better not to begin training in the trading process, but rather trust in professionals.
Thus, whether to invest in real estate, or in antiques, or at interest, or where else - a decision requiring serious analysis by criteria such as reliability, profitability, riskiness, etc. It is always worth starting from the current economic condition of the country.
Equity Investing
This is the most popular investment tool to date. Its popularity is determined by a number of exceptional advantages, as a result of which it is leading among the rest of the investment tools. However, in order to ensure maximum efficiency from securities, you need to have a certain amount of knowledge regarding the investment process.
Stock trading is a fairly simple process because a substantial amount of data is stored electronically. If the required knowledge is not available, then it is worth entrusting the trade to a professional trader. He organizes tenders on favorable terms for commission fees.
Advantages of the investment instrument in question
Investing in stocks is beneficial for the following reasons:
- annual return on shares is 100%;
- the share price is set based on the profit of the company behind it; this profit is a derivative of inflation (directly, the art of company managers brings additional profit to the shareholder).
The disadvantages of this investment tool
Many people consider investing in stocks as an inexpedient solution, since:
- they have a volatility property (under the influence of the market, the value of shares may drop sharply);
- the shareholder will be able to make a profit in the last turn (first, payments are made to suppliers, employees, creditors, etc.).
Education as an investment option
Such an investment in the future will bear fruit as a new position and, accordingly, a good salary. And in the current crisis situation it will be useful to think about a second higher education or advanced training courses or retraining.
Education is a good option where you can invest money, especially since this kind of investment will provide a number of advantages in the labor market. In addition, during the crisis period, it will also be possible to save on training (most universities provide discounts in order to attract customers).
However, you should not invest in education if there is doubt about the lack of time or patience to finish training.
Travel as an option to invest in
Many consider this the most worthwhile option for spending money. For psychological satisfaction, along with purchases, it is also necessary to invest in good impressions. In this regard, rest must be complete, as it can affect the quality of further work.
However, traveling is not a good option for what to invest in, if they are credit or the last. Also, the trip should be planned independently, due to the fact that recently there have been more frequent cases of bankruptcy of travel agencies.
Startup Investments
To begin with, it is worth telling what a startup is. These are innovative companies that offer fundamentally new technologies. The implementation of new and unknown technologies, bringing them to mass consumption is a rather difficult task, the favorable resolution of which can bring more than one hundred percent of the profit. That is why this option is recognized as approving regarding where it is more profitable to invest money.
To make money on this type of investment, you need to be sure that such components as the goal, team, idea and plan are closely interconnected, and the company clearly understands its mission and how to realize it (the main component of success).
There are enough examples where startups from zero point turned into billionth holdings, while enriching their investors at all stages of development. There are currently special startup exchanges that bring companies and investors together.
"Startup Exchange" - a site where company data, their offers, business plans are registered and the amount necessary for promotion is indicated. Interested investors contact the company and subsequently invest in its offer. One startup can have more than one investor.
Pros and cons of this type of investment
This is a good option as to where it is more profitable to invest money, since even in a burnout situation, for example, ten out of eleven startups, the latter is able to recoup the losses incurred due to a profitability of several thousand percent.
However, a startup is always a risk and an unknown area. Quite often they die not because of a bad idea, but because of the illiterate organization and incompetence of the company's management.
Despite the minuses, this is still recognized as a good solution to the question of where to invest money (feedback from grateful investors is confirmation of this). In addition, many are guided by popular wisdom: "risk is a noble cause."
Investment service PAMM-account
Literally translated as a module of the percentage separation of profits. As an investment service, this is a form of trust management, which allows the investor to profit at the Forex market, attracting professional traders for this.
Its principle of action: investors (any person who has invested in PAMM accounts) make contributions to the general account with which the manager (trader) of their choice carries out the appropriate manipulations. As a result, the profit (loss) received is distributed based on the investor's share in the total account.
Security is ensured by blocking the ability of investors to withdraw funds from their trader. The investor, in turn, can withdraw funds due to him at any time convenient for him.
A prerequisite for the manager is to deposit his own funds into the PAMM account. This is due to the sharing of risks (a trader, making transactions, risks his own means). For each profit earned, a fee is due to him, the amount of which is attributed in the agreement (20-50%).
In order to protect investment funds from their complete loss during trading on PAMM accounts, it is possible to set a loss limit to a certain level. It is also realistic to adhere to a zero risk strategy.
PAMM Account Benefits
They have the following form:
- compared with a bank deposit, a more substantial percentage of profit (based on the professional skills of the manager, up to 100%);
- the possibility of earning income in the shortest possible time (per week);
- the possibility of choosing a manager according to your requirements;
- acceptable level of minimum investment (from $ 100);
- the ability to quickly withdraw funds on demand (within a week);
- free schedule;
- round-the-clock monitoring of investments;
- a comfortable way of investing (remotely);
- investment management from anywhere with Internet access;
- there is no need to undergo training for playing in the foreign exchange market;
- withdrawal of funds in any convenient way (bank account, Yandex.Money, WebMoney, etc.).
Trustee Guidelines
The values of the main parameters of the PAMM account are as follows:
- Amount in management (an indicator of the trust of other investors to the general manager).
- Manager's capital (the trader risks his capital too).
- Age (due to the fact that the calculation of the corresponding interest on the amount occurs every week, it is also indicated in weeks). It is recommended that you choose PAMM accounts that are less than twelve weeks old. The longer the account runs, the easier it is to track the results of trading, the professionalism of the trader, etc.
- Minimum investment amount (does not reflect the degree of success of the trader; allows you to choose the right PAMM account).
- Secondary signs of reliability (displaying the activity of a PAMM account using various ratios, their ratios, as well as formulas for determining the reliability of investments in these accounts based on a post-analysis of the trader's work)
So, the decision as to where it is more profitable to invest money is made depending on the current state of the economy and on what purpose the investor is pursuing.