During an economic crisis, you want to be sure that your portfolio of fixed income investments, stocks, and other investments are safe from a downturn in the economy. Whether you invest in Hollywood films or put all of your money in the stock market, it is important that you are fully prepared in the event of a breakdown in the global market. If the recent fall of the Chinese economy is any indication, investors need to crash-proof their investment portfolio sooner rather than later.
What Can You Do To Crash Proof Your Fixed Income Investments?
A bear market is one that sees a decline of 20 percent or more for a period of at least two months. The following are some methods that prevent permanent losses during bear markets:
- Don't panic: First off, do not make any rash decisions based on one bad day in the market. Do not be tempted to sell off your investment just because it took a hit. More than likely, it will eventually rebound. If you sell it too early, you risk not seeing returns in the future.
- Diversify among stocks: Keeping all of your money in shares of one company is asking for disaster should there be an economic meltdown. Make it a goal to own numerous shares in multiple companies.
- Spread investments geographically: Another way to protect your portfolio is to spread investments out to a variety of regions. For those who invest in Hollywood films, this can be easily done by investing in both domestic and foreign films.
- Include fixed income investments: While it can be traditional to invest largely in the stock market, don't forget to include some fixed income investments as well. These investments can be a wonderful source of stability during a bear market. The amount you need will be based on your personal situation.
- Diversify through different sectors: The one mistake many investors make is keeping all of their money in one sector of stock. This is not advisable, as entire industries have been subject to economic downfall. Investors who had the bulk of their wealth in real estate took a major hit during the housing bubble. You can spread your money around to different industries. Invest in Hollywood films or other sectors, even if it is something you are not familiar with, in order to safeguard your investments.
Crashes happen, and they are going to continue to happen, so it is important to be prepared. Investing in Hollywood movies with Media Society can help ensure you have a strong, diversified portfolio. Add to your fixed income investments by adding alternative forms of income through a variety of means in order to have a healthy mix of funds. Don't let a crisis like a world market crash wipe out a lifetime of wealth. If you would like to diversify your investment portfolio, consider checking out equity crowdfunding opportunities.