Where is it profitable to invest money in 2021 - TOP 5 options

Despite the rapidly deteriorating economic situation in Russia, there is still a certain layer of people with free cash. For this category of citizens, the urgent problem is not only of preserving existing savings, but also of investing them in projects that can generate passive income. There are several areas of investment. Some methods are traditional and classified as low-income, but the return on investment is guaranteed with a small profit, which in most cases barely covers inflation. Others are more risky, but the amount of passive income generated as a result of investing in these projects is not comparable to the amount of invested funds. Let's consider where is the best place to invest money in 2021?

Bank deposit

The simplest thing you can do is open a deposit account at a bank. Such investments are safe, but usually do not have high returns. Interest rates on deposits are falling all the time. And now in various credit institutions they range from 4.5% to 6% per annum, which is not even able to compensate for inflation.

For bank deposits, the profitability is determined by the key rate set by the Central Bank of the Russian Federation. This is the main economic indicator that speaks about the real cost of paper money in the country and the level of inflation processes.

Official data on rising prices for basic goods hardly reflect the actual picture of what is happening, which everyone can see from the price tags in stores. Therefore, the interest rate, and hence the yield on deposits, will continue to decline further.

The situation is slightly different with foreign currency deposits. Bank deposits in euros do not give their owners a return of more than 1% per year. Investments in dollars do not promise much higher returns. With an eye on Europe, the Central Bank may well introduce a negative rate on deposits in foreign currency, so that depositors will have to pay for storing their own money. No matter how absurd it may sound, the reality of such a situation cannot be ruled out.

The main advantages of keeping funds on a bank deposit are low risks, predictable returns, participation in the deposit insurance program and the availability of this type of investment for everyone.

The disadvantages are the impossibility of withdrawing funds before the end of the contract without loss of dividends and the low level of profitability.

Synterium platform programs

On the basis of this platform, several very important and promising programs are operating (or are preparing to launch), in which the social orientation is clearly expressed:

1. A program to collect genetic material from as many people as possible for research activities in the field of health (Genomics Program); financial program (Synterium Finances).
2. A program aimed at collecting information about the level of carbon dioxide in the atmosphere, which is a factor indicating possible climate change (Synterium Ecology)
3. A program dedicated to a person's lifestyle.

Each of these programs can help you make money and even make a career, which can be found out in detail on the official website of the community.

Investments in real estate

Traditionally, the majority of the population considers investing in real estate (purchasing apartments) to be the best way to save money. But this is not without risks. Firstly, you can’t buy an apartment in Moscow for a million. A much larger amount of money will be required for acquisition, repairs and furnishings. Secondly, there is a danger of falling for an unscrupulous developer and joining the ranks of defrauded shareholders. Thirdly, it is also not easy to find adequate and decent tenants.

The real return on rental housing is from 6% to 7%, which is not much more than the interest on the deposit.

In addition, the apartment has low liquidity. It cannot be quickly sold and cash received. The process of implementing and finalizing a transaction usually takes several months. In this case, you will have to pay for notary and legal services.

Among the advantages of investing in real estate are protection from inflation (housing prices usually only rise), rental yield, simplicity and transparency of the investment scheme. The disadvantages include high real estate prices and relatively small rental profits.

Shares and equity funds

IT

IT and biotech are two key industries that could see maximum growth in 2021. During the forced lockdown of 2020 and self-isolation, IT companies made a big leap forward. Life has largely moved online - we learned what remote work and study are, watched online concerts, performances and master classes, and began to order more from online stores.

The IT sector has developed significantly during this time, companies began to receive more real profits, therefore, there was a sharp revaluation of the value of their shares. Thus, the Nasdaq index, which includes shares of 100 US technology companies, has grown by 43.27% since the beginning of 2021, while the S&P 500 has grown by 13.6% (in dollars), and the Moscow Exchange index has grown by 5.22%. (in rubles).

It may seem that there is a bubble in IT, like in 2000 - but, in my opinion, this is not so. Now IT companies have real profits and a powerful resource base - and at the same time there is room for growth: automation, robotization, optimization, colonization, etc.

So in 2021, the growth trend in IT will continue, but perhaps not at such a frantic pace. Large companies like the FAANG will become even larger, although newbies going public will also get a piece of the pie.

In my opinion, it is now difficult to determine the winner in IT, since some companies are growing (or not growing) in general against the fundamentals: emotions and expectations rule the roost in the market. Therefore, it is worth entering this area with the help of ETFs - especially since the Moscow Exchange has two cool different IT funds: TECH from Tinkoff and FXIT / FXIM from Finex. Or choose reliable companies that have proven themselves for a long time, such as Apple, Microsoft, Facebook, Intel, Cisco, etc. But when choosing individual stocks, you can “sleep through” the unicorns.

Biotech and medicine

In the post-Covid era, much more attention will be paid to health issues. Biotech and medical technology could become a new gold mine in 2021. There are a whole bunch of promising names here: Moderna, Pfizer, Abbot Lab, Danaher, Gilead, Amgen, Merck, Vertex, Biogen... I just want to cram each one into my portfolio =)

The variety of biotech and healthcare company options also makes it easier (and more effective) to invest in this space through an ETF. It will be difficult to determine the winner, and all companies are good. It's easier to bet on all horses than to try to guess the winner.

By the way, the chart clearly shows that the Nasdaq Biotechnology index outperforms both the S&P500 and, of course, IMOEX.

So far, only one biotech fund is listed on the Moscow Exchange - TBIO. There is more choice on the New York Exchange: Health Care Select Sector SPDR Fund (XLV), Vanguard Health Care ETF (VHT), iShares NASDAQ Biotechnology ETF (IBB), SPDR S&P Biotech ETF (XBI) and many others.

Growth stocks

IT, biotech, 5G, aerospace, and green energy are all technologies of the future. Investing in them for the long term in 2021 is a great option. We are now at the origins of many technologies that will bring huge profits over a period of 5-10-15 years. But you need to be patient and correctly identify the winners, since quite a few will fall in the fierce competition.

In growth stocks, in my opinion, you shouldn’t play a guessing game... Yes, yes, that’s right. It's easier to buy a fund. Either sector-specific (like TBIO or FXIT), or all at once, for example, Vanguard Growth ETF (VUG) or iShares Russell 1000 Growth ETF (IWF).

Cyclical stocks

After the March crisis of 2021, the economy somehow, with a creak, and not yet everywhere and not completely, but restarted. This means that cyclical stocks will once again fail to trend. We are already seeing this: shares of oil companies, gas companies, steelmakers, miners, developers, retailers, telecoms are rising in price... All those who fell sharply at the height of the crisis are now gaining strength.

Most cyclical stocks are value stocks and are also dividend cows. Vivid examples of such shares in the USA: AT&T, Johnson&Johnson, Procter&Gamble, Coca-Cola, Walmart, Chevron, Exxon, Qualcomm, 3M and many others. In Russia: Severstal, Alrosa, Lukoil, Tatneft, LSR, X5 Retail Group - and almost everything (we don’t particularly have growth stocks).

I think these types of stocks are what will make the economy in 2021. Now many of them are significantly below the highs reached in 2018-2019, and at the same time their business has not deteriorated during the epidemic (I mean the material and production base: oil workers still have their pumping stations, retailers still have their stores, producers of goods - factories and machines, etc.), only financial indicators suffered due to low sales. So you can get it at good prices.

On the paid channel Boosty.to I maintain a model portfolio of undervalued stocks with quarterly rebalancing - you can choose from them.

The main thing is to beware of zombie companies, there are many of them among value stocks.

Dividend Blue Chips and Dividend Aristocrats

Most dividend stocks are cyclical companies, so their prices fall during a crisis. There are so many good dividend chips trading well below their highs right now, so you can get some great dividend yields.

Thus, for US stocks the dividend yield can reach 11-13%. For example, Philips 66 has 13.15%, Oneok has 11.35%, Exxon has 9.42%, AT&T has 7.34%. Russian shares have a potential dividend return in 2021 no less: for example, for Surgutneftegaz it can reach 15-16%, for Globaltrans 14.7%, and for MMK – 11-12%.

Moreover, we are talking specifically about “blue chips”, i.e. the most liquid shares of companies with good business and stable cash flows. For many, the upside to former highs is still 20-30%. For example, Lukoil has still not risen above the value of 5,600 rubles, although it reached 6,800 in January 2021.

But you need to hurry: quite a few liquid chips with stable dividends are already growing rapidly. For example, Sber has reached pre-crisis levels and will most likely continue to rise.

Naturally, buying dividend stocks from the highs is much less interesting than from the lows. After all, the lower the quote, the higher the dividend yield.

It should be taken into account that in 2021, most chips will pay annual dividends based on the cash flows of 2021, which, as you know, the cat cried. Therefore, dividends in absolute terms may be lower than in previous years.

There are two options with blue chip quotes:

• they will, like Sberbank, grow based on expectations, despite possible small dividends;
• they will be under pressure, like Lukoil, despite a possible increase in dividends.

In the first case, the dividend yield will be lower, in the second – much higher. The second category of shares, naturally, is much more interesting in the long term.

Business Investments

If you think that you just need to invest in a business and, relax, wait for the money to rain down on you in the form of a golden shower, then this is not so. The profitability of such investments will largely depend on your professionalism in the chosen field of activity, the strategy used, the effectiveness of planning and the presence of competitors.

Being an entrepreneur is hard work, but it more than pays off with high returns, thanks to the fact that you work for yourself and not for someone else.

Owning your own business is not for everyone. It is associated with great personal effort, the complexity of organizing the process and external economic risks.

Websites and own online projects

Investments in yourself, your education and your own business remain relevant in 2021. One of the forms of such a business is profitable sites, and its variety is information sites.

I wrote a detailed article about how to invest in websites, I advise you to read it.

I would like to note that in 2021 the effectiveness of such sites will only increase, but, of course, with the right approach. You won’t be able to simply buy a website, upload hundreds of articles to it, hang contextual advertising and wait for profit in 2021. It is necessary to add various services, work with readers and subscribers, create a positive image, use different communication channels - in general, implement content marketing. You need to be an expert in your field to give people something really necessary and important. But rewriting the same articles (rewriting) doesn’t work anymore.

Yes, working with websites is becoming more difficult every year, the cost of entering the industry is also growing - but for now, investing in information sites remains the easiest and most affordable way to start an online business.

Investments in the securities market

Let's look at the simplest types of investments, such as stocks and bonds. A company share gives the right to own a share in the business. The owner of shares can count on profitability in the form of dividends and has the right to vote when deciding issues at a meeting of shareholders. With successful development, the company's share price also increases. The profitability of most enterprises can exceed the rate of inflation by three or even five times. Steady profit growth enriches shareholders by increasing the price of securities.

Shareholders transfer paid dividends to bank accounts or purchase additional shares, providing themselves with even greater profitability.

Profit on shares of some companies significantly exceeds the profitability of bank deposits. Today, the stock market is dominated by securities of Nizhnekamskneftekhim, Gazprom, Sberbank, Moscow Exchange and LSR.

So, if at the beginning of 2014 you had invested a million rubles in the listed securities, then by the fall of 2021 their profitability without dividends would have reached the levels presented in the following table:

Taking a long-term perspective, the annual return on investment in stocks can be up to 16%.

Bonds are debt obligations of a company that it promises to fulfill by paying investors the nominal cost of their acquisition and a certain percentage of profit. The price of bonds may change slightly, and the percentage of profit is agreed upon in advance. There is a risk that the company will not pay its obligations. However, the number of such defaults in Russia does not exceed 0.5%.

OFZ - federal loan bonds - have the greatest reliability. The yield on them can reach 7.5%. If you buy these assets on an IIS (individual investment account), then due to tax deductions you can increase your profitability to a record 20%. To diversify risks, they usually invest in securities of several different companies at once. For transactions with stocks and bonds, a special brokerage account is used.

Stock Market Investment Strategies

In order to place our million with the greatest profitability, we will learn about the three main strategic types of investment - aggressive, conservative and moderate.

• Conservative investors
  strive to minimize risks, so they often choose safe instruments such as OFZs. These securities are issued by the state. If the OFZ yield at the time of maturity is 6.66%, then in monetary terms it will be (for OFZ 25083) 34.9 rubles. It is not enough. But if you purchase these securities on an individual investment account, then, taking into account preferential taxation, the yield can be up to 19% per year. You can also increase profits by slightly increasing risks and purchasing bonds of reliable domestic enterprises.
• The moderate risk strategy
  assumes equal shares of bonds and stocks in the investment portfolio. That is, you can buy bonds of Rosneft and Sberbank with a yield of 7.65% and 6.96%, respectively, for 500,000 rubles, and with the second half of the money you can acquire shares of leading Russian enterprises presented in the table above. Such a balanced investment portfolio with an acceptable level of risk can provide up to 12% annual return.
• An aggressive approach to investing
  is characterized by selective purchasing of stocks alone. The increased risks can be compensated by increasing the period of placement of funds. This strategy can provide maximum returns of up to 16%.

Stock market participants should remember the following:

1. To conduct stock exchange transactions, you will need a brokerage account.
2. The longer the period of placement of funds, the higher the potential profitability.
3. Stocks and bonds often fall in price. You need to be prepared for this.
4. When the value of securities falls, it is necessary to buy the most promising ones.
5. Stocks and bonds can be quickly sold with immediate withdrawal of money to a brokerage account.
6. Those who invest for the long term are provided with tax deductions and benefits that further increase the return on investment.
7. You can take advantage of preferential taxation by opening an IIS.

Where is it profitable to invest money in 2021? Highly profitable HYIPs!

Beginners are afraid to invest at high interest rates on little-known sites. Experts advise considering them as one of the excellent options. The main thing is to log in to the system on time and withdraw your profits.

Highly profitable HYIPs are constantly being created, the topics vary, from betting to Forex.

We use and recommend only one HYIP format - games with money withdrawal. They offer really favorable conditions, and they don’t take much time. Need an example? Let's consider it with the MoneyBirds project, where they offer to buy birds and sell eggs:

These are the most expensive birds, the latter brings 63% per month. Considering the conditions that only half of the profit is available for withdrawal, we get a little more than 30% per month and a full payback in 3 months.

The likelihood that the hype will survive this time is quite high, because most high-quality economic games work for several years.

It’s easy to invest money in highly profitable gaming HYIPs, but you need to understand that the risks here are quite high. Therefore, you cannot pour all the capital into one project, you need to divide it into as many parts as possible. It’s good that the choice of investment games is quite wide:

1. TaxiMoney is one of the oldest games that offers investment in a virtual taxi fleet.
2. GoldenMines – has been paying regularly for 5 years, income comes from miners extracting ore.
3. GoldenTea is popular all over the world, available in different languages, earnings come from the sale of tea leaves.
4. RichFishing - a game about fishing has already paid out more than 5 million rubles (there are payments to bank cards).
5. Kolxoz is an old, proven game about farmers, where they make money from animals, crops and various industries.
6. GoldenOligarch – you hire miners and sell ore. There is a welcome gift, total payments are over 27 million rubles.
7. MarketHit – build your own virtual store, you need to invest at least 19 rubles to receive payments.

Please note that some games use payment points. They limit withdrawals and require attracting new players. No problems will arise if methods for recruiting referrals are used.

People willingly register for such projects because they are also looking for the best place to invest their money.

Buying precious metals

The profitability of investing in precious metals is determined by the increase in their value. Historically, the value of gold and silver, despite short-term fluctuations, only increases in the long term. However, this perspective can be measured in both years and decades. Those who purchased the yellow metal back in 1979, due to almost thirty years of market stagnation, began to make a profit from their purchase only after 2008.

Precious metals by themselves do not generate additional value. Their profitability depends entirely on demand and price growth. According to data for 2021, only 59% of all gold produced in the world went to industrial and jewelry needs. 41% of the precious metal went to satisfy investment demand and replenish the reserves of leading central banks.

Gold is considered an anti-crisis asset.

And now it’s not just a crisis, but according to analysts: the collapse of the world economy. Right now, gold can protect your million from inflation. There are several options for investing in precious metals:

1. Buying gold coins or bars from a bank or pawn shop.
2. Opening a bank compulsory medical insurance (an impersonal metal account).
3. Purchase of securities of gold mining enterprises, ETFs and mutual funds.

Among the advantages of such investments are high returns during economic crises, clarity and accessibility of investments.

The disadvantages include low profits in a stable economy, as well as commission expenses, VAT (gold coins are not taxed), and personal income tax when buying and selling assets.

IPO

2020 was marked by single, but very high-profile IPOs. I am confident that in 2021 the number of companies choosing to go public will increase dramatically. And most of them will be from the IT sector, online retail, biomedicine, 5G, green energy, etc. – i.e. from the most advanced technologies. So, I suggested which Russian and foreign companies could enter an IPO in 2021. You can track future IPOs using special calendars.

Even an ordinary person can invest in an IPO. There are several ways to do this. You can invest directly through individual brokers, for example, United Traders (and for this you do not need the status of a qualified investor), or still obtain qualified status and invest through your broker - for example, this is how they allow you to participate in the IPO of Tinkoff, Freedom Finance, Otkritie, Finam, VTB and a number of other brokers. Or you can simply buy shares on the first day of trading (albeit at an inflated price if the demand for the company was frantic).

You can also invest in funds that invest in IPOs. In Russia there is only one such fund - closed-end mutual fund “Initial Placement Fund” from Freedom Finance. There is also a post-IPO BPIF from Tinkoff with the ticker TIPO. Well, there are always foreign ETFs for IPOs.

conclusions

The best way to invest a million rubles in calm times is to invest in securities, since the return on the stock market segment is always significantly higher than bank and foreign currency deposits, as well as investments in real estate. However, in the crisis year of 2020, it is better to play it safe and invest part of your funds in protective safe haven assets, for example, in physical gold or other metals. It is important to decide on an investment strategy in time and correctly distribute assets in the investment portfolio, taking into account their prospects, reliability, as well as the economic situation in the country.

High yield bonds

In the last review, I wrote that in 2021, investments in VDO are of particular interest, although they are quite risky. In 2021, investments in VDO remain interesting, but there are fewer and fewer specific stories. The fact is that the key rate in the economy is decreasing, which means that new VDOs offer less and less yield to maturity.

If in 2021 it was possible to find decent VDOs with a yield to maturity in the region of 14-16% per annum, now this level has dropped to 12-13%. Moreover, a new tax on bond coupons will come into effect in 2021, which will further reduce the yield of debt securities.

In addition, in certain sectors of VDO, the risks of bankruptcy increase. If in 2021 many companies were supported by the state, and some had the “fat” to survive the drop in sales, then in 2021 a series of severe bankruptcies and defaults will follow.

On the other hand, investors' appetite for risk is growing. Therefore, the price of VDOs themselves on the market is also growing. The yield to maturity of VDOs is also reduced due to an increase in the market price of securities.

If you decide to enter the VDO, then you need to carefully select issuers: both in order to minimize defaults and in order to increase the maximum coupon yield. I talk about this in detail in my course, and also buy high-yield bonds for my public portfolio, following exactly my own instructions for selecting securities.

Afterword

The main thing in the field of investment is not to put off until tomorrow. To procrastinate means to postpone the purchase of real estate, a well-deserved vacation, or a decent education for children. Most of the methods described above do not require a physical presence and can be done via the Internet, and therefore are suitable for almost everyone. Be bold and luck will certainly smile on you.

The cryptocurrency mining market – what is it like for beginners?

After reading about the GectaCoin coin, an inexperienced user may be indignant: “What are you slipping us? People earn millions on Bitcoin and Ethereum, but they tell us about some little-known Jacktacoin, and even persuade us to invest money in it!”

And we, dear readers, are writing about this money because it is still little known, and you can still have time to connect to its network. The popular cryptocurrencies so beloved by everyone, alas, are not for you, believe me. And that's why:

1. Difficulty of extraction. Those times when it was possible to mine the now popular crypt on a home computer are long gone. The complexity of mining has grown so much that the process no longer requires single computers, but entire industrial farms equipped with the latest equipment. This leads to another reason why you should not get involved with top cryptocurrencies.
2. The high cost of mining devices and the process as a whole. Modern video cards are oh so expensive. And, as you understand, to create a farm you need a lot of such devices. And add the associated costs. That is, we are talking about funds that only a very rich person can afford to spend. Yes, and he will think about whether it is worth risking money, because there is another important point.
3. Low profitability of production. Yes, mining cryptocurrencies from the TOP list is becoming unprofitable. The number of miners increases, the complexity of the process increases, and profitability naturally decreases. It only makes sense to mine such currencies on an industrial scale, and even then no one knows how long this state of affairs will last.

We know that on the Internet you can find a huge number of articles and videos in which some craftsmen share their experience of successful mining of one or another popular crypt. But let's look at things sensibly. Believing such stories is, to say the least, illogical, but many people do.

Think for yourself. Let's say you stumbled upon a gold mine. And instead of quietly digging for gold for their own needs, they took it and told the whole city about the happy find. What will you discover the very next day? That's right, anything but gold, since there will be many who want to “help” you mine it. You will say that the example is stupid and a normal person would never do that. We agree. But then how can you believe the stories of miracle miners who suddenly decided to share with you the secret of their wealth? You might think that life without competitors would be boring for them.

Reasons to give preference to USB miners

We have already mentioned two such reasons - a fairly reasonable price and compatibility with any PC. But there are others.

These miners consume very little electricity, and its cost makes up a significant part of the mining costs. They are durable, lasting thousands of hours. There is no such irritating factor as increased noise that drives the whole family crazy. Add to this their compactness and the ability to connect a large number of devices to one “machine” using USB hubs, and you will agree that these miniature “getters” have quite a lot of advantages. True, it’s hardly worth mining a popular cryptocurrency with their help, but many altcoins are very convenient and profitable.

Crowdinvesting – perhaps the “investing” of a new generation

If you are thinking about where to invest in 2021, think about crowdinvestment, or collective investments.

There are not many sites in Russia where you can legally and safely invest in projects. The most famous:

• Alfa Stream is a platform from Alfa Bank;
• City of Money;
• StartTrack.

There are others, but it is difficult to distinguish them from HYIPs - highly profitable companies that actually turn out to be financial pyramids.

I wrote about how to invest in business here (more precisely, over there).

Ready investment products

Compiling a competent portfolio of bonds, currencies and stocks will require time and effort on the part of the investor. If there are difficulties with this, then there are two ways: contact a financial advisor for help in drawing up a portfolio or opt for ready-made investment products. These include mutual funds and structured products. Knowing your risk profile, financial goals and investment horizon, it will not be difficult to choose a suitable investment product with a protective or income profile.

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