Where do I invest in a recession?

It may seem counterintuitive to invest in a down economy, but you’re actually making a smart move when you invest during a downturn for many reasons. Firstit is providing fresh capital to the economy, which will eventually recover to its benefit. SecondMost good company stocks are down so you can buy them cheap, which means you can get great deals and sell them for a profit when the market goes up.

The trick is knowing what investments to put your money in. Fortunately, there are five good investments that are either guaranteed to return your investment plus profits or have proven to be stable even in a down economy.

Deposit certificates

With certificates of deposit, your main investment is safe in the bank regardless of the state of the economy. You’ll earn interest on your investment at a fixed rate for a fixed period of time. Keep in mind, however, that you should invest in certificates of deposit only with banks and credit unions insured by the Federal Deposit Insurance Corporation and the National Credit Union Administration, respectively.

Stocks of tobacco and alcohol

Regardless of the state of the economy, tobacco and alcohol consumption in many markets is stable. In some markets, it may even increase, especially in developing countries, as manufacturers will direct their aggressive marketing tactics to countries where regulations are lax and where markets are still in growth stages. As such, tobacco and alcohol stocks — sin stocks, as most insiders call them — are excellent investments even in a recession.

pharmaceutical stocks

There are many reasons why pharmaceutical stocks are relatively stable in a recession. For one thing, everyone will take advantage of healthcare at some point and therefore buy medicine. On the other hand, the discovery of new and better drugs is a constant factor in an uncertain world, which could even be said to be an imperative necessity in man’s quest for immortality. So he can be confident that pharmaceutical stocks will hold up even in an economic downturn.

Electric utility stocks

Electricity is a staple of modern life, the absence of which will cripple industries and countries. As such, your investment in electricity related companies will almost always generate a good return on investment. However, you must stick to two investments in electricity. First, invest in established power companies with guaranteed returns on investments as they expand their market bases. Second, invest in companies dedicated to power generation with large investments in infrastructure, since they have a competitive advantage that few have today.

real estate

With the national trend of foreclosures, now is the time to invest in real estate, especially since it is a buyer’s market. In fact, you can buy desirable properties at rock-bottom prices, then sell at higher prices when it becomes a seller’s market.