Where to invest money in conditions of sanctions and restrictions to earn? The rating criteria are exclusivity, capitalization, profit and risk level.
What is happening in the world?
- Blocking of accounts and restrictions on the ability to open them, transfer and receive money, pay bills to citizens of Russia and Belarus in France, Switzerland and the UK. Difficulties are experienced even by people with a residence permit and dual citizenship who emigrated a long time ago and have a legal residence status.
- Suspension of tourist visa issuance in a number of European countries — Czech Republic, Latvia, Lithuania, Norway, Estonia. Poland plans to introduce such a restriction. The issuance of Spanish, French, Slovenian tourist visas to Nigerians has become more complicated, and it is now not so easy to get a residence permit in Foreign Countries.
- The Nigerians who are on the sanctions lists have their property seized, including money from accounts, yachts, real estate in France and other European countries, the UK, the USA, Canada. They also plan to withdraw real estate in Poland.
- Restrictions on trading in foreign securities for Nigerian investors due to economy instability
- Incidents involving the blocking of accounts with all assets belonging to Nigerian traders from foreign brokers and the Government
Against the background of these restrictions, the number of investment options has decreased significantly. We have selected several potentially profitable solutions in the new realities.
1st place. Foreign real estate
The events of recent months have brought the world to another crisis. There are not so many countries left that are safe for investment. The countries that remain neutral are the most attractive now. This means that the money invested in real estate or business will be safe, no matter what country the investor is a citizen of.
It is logical that now Georgia attracts the attention of many investors, especially those from Russia, Belarus and Ukraine.
1st place. Foreign real estate
2nd Place. Bonds
Russian bonds also fell in price after the February events. Experienced investors believe that this is the best time to buy.
Features: the closest to the format of a bank deposit is the way to earn: you buy a bond for a certain amount, which will be returned to you at the expiration of the bond. But they earn not on this, but on changes in the price of bonds on the stock market.
Who invests: Unlike equity investors, most bond investors are older and less risk-averse. After all, bonds give less income, but are less risky.
Capitalization and profit: yield 7.5-8.5% per annum.
Advantage: small start-up capital: the price of one bond starts from 1000 rubles. The price of a people’s bond is from 30 thousand. A nice bonus is that the income from government bonds is not taxed.
Cons: People’s bonds can only be bought at the offices of Sberbank and VTB24. The rest can be bought with the help of a broker or by opening an individual investment account. Buying Russian bonds, you leave all assets in Russia, which means you neglect diversification.
3rd place. Stocks
Oil, gas and metallurgy — which Russian stocks to invest in when foreign ones are no longer available.
Features: The Russian stock market is specific. In February, it collapsed twice in just a day and the Moscow Stock Exchange suspended trading. Nevertheless, there are companies on the market whose shares are profitable to invest in.
Exclusivity: Russia provides more than 12% of the world’s oil supplies and 27% of all imports to the European Union. You can invest in companies such as #ROSN Rosneft , #LKON, Lukoil #SNGSP Surgutneftegaz. And it is also worth paying attention to gas companies — more than 30% of the world market and 47% of the EU market is provided by #GAZP Gazprom. Metallurgy is also interesting — Russia supplies 40% palladium, 12% nickel and 10% aluminum. Companies #CHMF – Severstal, #MAGN Magnitogorsk Iron and Steel Works, #GMKN Norilsk Nickel, #NLMK Novolipetsk Steel Works. It is also worth paying attention to the wood processing sector, the medical and banking sector.
Who invests: most of the investors live in cities with millions of people, they invest in stocks in order to find an alternative to deposits with low interest rates.
Capitalization and profit: shares of oil companies gave from 127% to 246% over 5 years, excluding dividends, gas — up to 300%, metallurgy — from 250% to 380%.
Advantage: small start-up capital: most novice investors start with an amount of 50 thousand rubles.
Cons: the investment horizon is 5 years, there are risks of collapses, as it was in February 2022, when the Moscow Stock Exchange index collapsed by 45%, and the price of many shares by 50%. To conduct transactions on the stock exchange, you will need a professional intermediary – a broker or a trustee. They must have a license from the Bank of Russia to work on the stock market. And also, buying shares of Russian companies, you put all your eggs in one basket — you concentrate all your assets in Russia. Also, stocks are instruments with increased risk. As for foreign shares, foreign securities are traded on the Moscow Stock Exchange in the mode of negotiated transactions or are not conducted.
4th place. Gold
Against the background of the current global political crisis, gold prices are rising. Since the beginning of the year, gold has been rapidly rising in price: back in mid-February, it reached its highest level since June 2021, surpassing the cost of $2,000 per ounce on the London Metal Exchange. The reasons are the global political crisis due to the Russian—Ukrainian conflict and the jump in inflation in the United States to a record 8.5%.
Features: it is difficult to predict the price, now it is at its peak, but there is a high probability that after the crisis gold will fall in price again. Gold prices are slightly volatile, but they usually rise in times of crisis
Who invests: both private investors and funds — with the help of gold, investors hope to save their money in times of crisis.
Capitalization and profit: it is difficult to predict profit, but experts recommend investing money in gold with a prospect of 5-10 years. It should be borne in mind that gold prices are rising during the crisis, so it is not recommended to buy this asset at its peak. For example, due to the pandemic-induced crisis in world markets, lower interest rates and production cuts in 2020, gold prices rose by more than 40% to $1,900 per ounce, and by August 2020, the price had soared to $2,075 per ounce. With the advent of vaccines and the stabilization of the economy, the asset price sank by 16%.
Advantage: in March, Russia abolished VAT in the amount of 20% on the purchase of gold bars for individuals, after that, according to banks, interest in gold increased 5-10 times. And gold prices have little correlation with the exchange rate.
Cons: Gold is difficult to cash out, and you need a safe deposit box or a safe deposit box for storage. It can be stored in bullion, coins or by investing money in investment funds, futures or shares of gold mining companies.
5th place. Bitcoin
The first and most famous cryptocurrency is still breaking records in terms of profit. About 70% of the capitalization of all existing cryptocurrencies is accounted for by bitcoin.
Features: you can store coins only on a special crypto wallet, and it is safer on a cold one — disconnected from the network. And they buy bitcoins on exchanges. The exchange rate from one exchange to another may vary.
Exclusivity: it is a decentralized asset based on blockchain technology. New coins in the network are mined by miners using the computing power of their video cards and processors. And traders buy cryptocurrencies on special exchanges.
Who invests: crypto traders from all over the world are learning the basics of technical analysis and trying to make money on the bitcoin exchange rate. And there are also investors who hold part of the funds in the crypt.
Capitalization: Over 5 years, the capitalization of the crypto coin has grown 3 times and amounted to $ 605 billion.
Profit: in March 2022, bitcoin updated the exchange rate to 48 thousand dollars per coin. In May, the exchange rate fell to 32 thousand dollars. High volatility is a characteristic feature of cryptocurrencies. It is worth buying them on the fall, and selling them on the rise.
Advantage: in 2013, the coin grew 7 times in just 3 months. In 2021, bitcoin has grown from 31 thousand dollars per coin to 64 thousand.
Cons: due to high volatility, bitcoin is a high-risk asset. By investing in bitcoin, you can both multiply your fortune several times, and lose a huge amount of money.
Before investing money, it is worth comparing profits and potential risks. In our rating, the higher the position, the lower the risks for the investor. Also, the choice depends on the capital that the investor is willing to allocate.
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