It is important to understand how to invest in a defensive way when it comes to retirement investing allocation. You never want to simply throw money at the stock market in a haphazard manner, especially when you are concerned about the diversifying your investments. While some people are perfectly fine with investing in the stock market in a broad fashion (using an index such as large-cap funds) there are those who prefer to invest in more non-standard investments. Here are some that are more defensive, which means that they will guard against a collapse in the general market.
Precious Metals In Your IRA
When the dollar plummets, people look for alternative investments. While the stock market can certainly be a safe haven in some times, when it's incredibly rough it's not a great time to sink your money into corporate stocks. There are some people who want alternative investments and one of the most popular alternative investments is in precious metals. Silver and Gold are two of the most popular investment choices. There are many ways you can invest in these precious metals. One way, which is popular with survivalist, is to actually hold (or horde, as some would say) the actual gold of silver. This might be in the form of bullion or in bars. Alternatively, for most people, the best choice is to find an IRA that allows precious metal investing. That way, you would be able to invest in a Gold or Silver backed IRA investment. An example of one such company is McAlvany ICA.
Bonds To Secure Against Uncertainty
In the event that you find that the stock market is too risky for your investment, then you need to look into alternatives such as bonds. These investments are perfect for people who are not too enthusiastic about sinking their funds into the stock market and investing in equities. When you invest in the stock market you are subject to the whims of the company valuations. However, when you invest in bonds, you are protected against a major market catastrophe. Bonds are essentially debt instruments, not shares in a company. So, you can ask your adviser about bonds that are corporate or municipal or mixed, and which would be better for your investing strategy.
Real Estate and Utilities
One of the most defensive strategies is to invest in real estate or utilities., These are defensive in that no matter how the economy goes, people need to rent space to live (as is found with residential real estate investment trusts ) as well as pay their utility bills. So, a good idea is to investigate an investment strategy that incorporates real estate investment and utilities. Some people might like to invest in REIT's, or broad utility ETF's, but what you need to do is look into each and consult with your investment adviser.Share