The 8 Best Long-Term Investments to Diversify Your Portfolio

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Keeping your money safe is obviously a top priority when investing. Still, you need to ensure you are diversifying your investments to protect your money long-term and ensure that you are protected should the worst happen.

This blog post looks at some of the best options for long-term investments.

Real Estate

Real estate has been a reliable and profitable investment for centuries. There are multiple ways to invest in real estate, but the most common is through real estate investment trusts. REITs are companies that buy commercial properties and then distribute the profits to shareholders in the form of dividends. You can invest in REITs through your stock broker or funds on a platform like Wealthsimple, which offers a range of REITs across the US, Asia, and Europe. Suppose you have a lot of cash and want to get involved in the nitty-gritty of real estate property management. In that case, you can also look into syndicating, where groups of investors pool their money to buy a property and distribute the profit.

Art

Art is a classic investment, with paintings, sculptures, and other pieces of art being traded as investments for a long time. The art market is big, very liquid, and accessible through various funds and asset management companies. The art market is also highly speculative, meaning that, similar to the stock market, art prices are subject to dramatic shifts in price. Due to the high level of speculation in the art market, investors need to understand the art piece they’re buying. This can be difficult to do on your own, but art funds that specialize in purchasing and selling art can help guide novice investors.

Commodities

Commodities are raw materials that are used in a wide variety of industries. They include everything from crude oil to metals like gold, silver, copper, and platinum. Commodities have been used as investments for centuries and have been particularly lucrative during periods when the stock market has performed poorly. The commodities market can be volatile, but if you’re looking for a long-term investment that’s not tied directly to the stock market, this is a good bet. Commodities can be traded directly in most brokerage accounts, but you’ll need a lot of money to make any significant impact.

Mutual funds

Mutual funds are like collective investments that people have used since the 1920s to spread their money across many stocks and other assets. Professional money managers manage them with a wide variety of investment strategies, from aggressive growth to conservative income. The nice thing about mutual funds is that you don’t have to worry about picking individual stocks or other assets – the fund managers will do everything for you. Mutual funds are available from various fund companies and are offered in many different types. Mutual funds will have a minimum investment but vary widely by type. Some have a minimum as low as $50, while others have higher minimums. 

Equity stakes in startups

This one isn’t for the faint of heart – or the faint of wallet. Equity stakes in startups are a long-term investment in a company that’s not yet profitable. If the company does well, the investor will make a lot of money when the company goes public or is bought out by a larger corporation. Startup investing is a high-risk, high-reward scenario. If the company tanks, the investor will lose their initial investment. This type of investment is available through equity crowdfunding websites like Fundraise and WeFunder, along with platforms like Wealthsimple that offer this type of investment. If you’re looking to invest in startups, it’s essential to understand that you’re making a long-term commitment. You’re not going to see any return on your investment for years – possibly even a decade or more.

Exotic ETFs

Exchange-traded funds (ETFs) are a low-cost and low-risk way to diversify your portfolio by spreading your money across various assets. Ordinary ETFs track baskets of stocks and other assets, but there are also what are called “exotic” ETFs. These ETFs track particular and rare assets that other ETFs do not commonly hold. Exotic ETFs are an excellent way to take a small position in a niche industry or asset that you don’t have the money or expertise to invest in directly. They’re also an excellent way to hedge your bets if you think a particular industry will do poorly.

Cryptocurrency

Cryptocurrency is a catch-all term for digital currencies like Bitcoin and Ethereum. Cryptocurrencies are highly speculative and volatile and are not recommended for most people. However, if you’re a risk-taker and have a lot of cash to spare, investing in cryptocurrencies is an excellent way to make money quickly. Cryptocurrencies are traded almost entirely online, so you’ll need a brokerage account to purchase them. Cryptocurrencies are very risky and should be considered a very high-risk investment. However, if you’re willing to withstand the risk, you could quickly make an enormous amount of money. It’s important to note that cryptocurrency is not regulated like other assets like stocks and bonds. Cryptocurrency is not backed by any government and is not insured against loss. Be very careful when investing in cryptocurrencies, and do your research before diving in; make sure you understand all the terminology and different coins and options, including the difference between crypto tokens and coins, as well as what crypto staking is for those with lower risk tolerance.

Peer-to-peer lending

Peer-to-peer lending involves loaning money to individuals through online lending services. These services have been around in the banking and finance industries for a while, but only recently have they begun to break into investment markets. Peer-to-peer lending is risky and should only be used as a very long-term investment – as in, you should plan on never getting that money back. If you want to invest in peer-to-peer lending, make sure you set a term on the loan where you can easily walk away from it if things go south. Peer-to-peer lending companies will have a minimum investment amount and a range of interest rates. Always read the fine print to understand what you’re getting into.

Conclusion

The best long-term investments don’t just make money – they also teach you something along the way. If you’re looking to start investing, you don’t have to jump in with both feet and invest everything you have all at once. Many investments have much lower minimums and are designed for people just getting started. Keep in mind that investing is a long-term game. Don’t get caught up trying to time the market or buy low and sell high. Instead, focus on building a solid, diverse portfolio and ensure you’re diversified across different asset types and industries.