The first and second quarters of 2024 were a bit tumultuous, but analysts continue looking for the best investments to help investors secure and compound wealth. The stock market rebounded towards the end of August. For example, utility companies have performed so well that their stocks outpace those in the S&P 500.
Below, we shall be considering some promising investments for Q4 2024, judging by their bullish tendencies. In addition, there is widespread anticipation of Federal Reserve rate cuts before the year ends.
- Utilities Investments: These are some of the best investments right now, outperforming even S&P 500 companies. As investments across the equity market get volatile, utilities are a great alternative. They offer a steady stream of dividends. According to the co-chief investor at LVM Advisors in New York, the utilities sector “is typically defensive and a good investment during economic slowdowns or recessions.” Organizations seldom cut their losses during economic crises. The high demand for energy to power EV charging stations and data centres keeps this sector galloping on all fours. Atmos Energy Corporation, NiSource Inc. and Dominion Energy Inc. are good examples of top utility sector performers.
- Emerging-Market Stocks: Providers of market indices, like FTSE and MSCI, often categorize countries like Indonesia, Mexico, Russia, Brazil, India and even China as emerging markets. So, it is possible for international companies domiciled in these markets to show investment potential. However, the caveat is that investing in emerging-market stocks may be more risky. So, using them to diversify your portfolio is welcome; analysts seldom recommend making them sole or core investments. Nonetheless, some emerging-market stocks, for example, Chinese ones, are performing quite well.
- High-Quality Bonds: Irrespective of the economic nosedive, some high-quality bonds yield significant year-on-year returns. For example, the S&P US Aggregate Bond Index has gotten 3.7% returns in the past 12 months. According to Thad Davis, CEO of Aureus Asset Management, “For more than a decade, intermediate and long-duration investment-grade bonds had unattractive yields; that changed after the rate shock of 2022.” Indeed, in 2024, Aureus Asset Management recommends these high-quality bonds to their clients.
- High-Yield Bonds: These are high-risk investments; analysts nonetheless posit that they have a lot of prospects. High-yield bonds are said to be more risky than high-quality bonds. Still, they remain one of the best investments of 2024. One thing about most investments is that the higher the risk, the higher the returns are likely to be. However, when the bottom gives way, the crash is often hard. Referring to the performance of high-yield bonds so far in 2024, Davis said, “Most of the performance has been driven by a decrease in spreads due to supportive economic activity.” High-yield bonds tend to perform exceptionally well in robust economies.
- Energy Investments: The oil and gas sector has been fingered as the black sheep of energy sources. Nonetheless, the biggest players in the industry are trying to keep their businesses sustainable through mergers while avoiding climate sanctions. It’s already an open secret that the use of green energy is gaining traction across the globe, but the use of fossil fuels won’t come to an abrupt end. However, most energy consumers and nations are still playing it safe. Indeed, with projections of higher prices of fossil fuels, oil and gas still exhibit undeniable prospects. So, don’t look too far for where to invest your money. The oil and gas sector will spin it around with good returns.
- Technology Stocks: The best-performing tech companies are leveraging the emergence of artificial intelligence and are growing at unprecedented rates. Judging by recent performance in the tech industry, the best stock to invest in 2024 is Nvidia Corp. (NVDA). Strutting closely behind are Microsoft Corp. (MSFT) and Broadcom Inc. (AVGO).
- Real Estate Investments: The real estate industry offers a secure route of earning passive dividends on investment in 2024. For those who don’t know, it is instituted by law that investment trusts in the real estate sector must distribute 90% of their income as dividends. Despite the flagging performance of commercial real estate, even those office buildings are starting to pick up. Real estate investments are for long-term holds as they are not easy to liquidate. Exploit the market when it is at its lowest, hold till the low cycle passes and enjoy tangible returns.
- Gold: The yellow commodity often appreciates in value during volatilities in the equity markets. Gold is a more secure store of value when stocks and bonds become unstable. So, investors naturally turn to them. Unlike real estate, investors may not have to wait for long before making tangible returns on their yellow commodities. Equity instability is more of the norm than not. So, analysts would recommend buying when the stock market is stable and bullish. Of course, the price of gold will be high nonetheless, but wait till market volatility sets in and the demand for gold shoots through the roof.
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- Dividend Stocks: Individuals who are looking to grow their investment portfolio should consider dividend stocks. They serve as a steady source of income, particularly those domiciled in strong sectors like utilities. The dividends may serve as a source of liquidity or increase the capital volume of an existing portfolio.
- Consumer Staples Investments: Consumer staples have been a top performer in the past three months, with returns of about 2.8%. Good examples of shares in this niche are Costco Wholesale Corp. (COST), Procter & Gamble Co. (PG), and Walmart Inc. (WMT).
What is the Best Way to Invest Money?
Still undecided about how to invest your money? Let’s give it one last shot. If the list of best investments in 2024 above is unconvincing or too complicated, get a load of the following. Some of the most common routes of money investment are stocks, exchange-traded funds, mutual funds, bonds, high-yield savings accounts, certificates of deposit (CDs), real estate and cryptocurrencies.
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However, before delving in headlong, investors may want to consider the one that best suits their financial status. In addition, your long—and short-term financial goals should determine how hard you go. Finally, the number of years an investor has before retirement will determine the level of investment risk they can expose themselves to.