During uncertain times like war, each one of us begins looking for a safe haven to put our money in and save it from losing its purchasing power. It is not possible to buy perishable daily products overnight and stock them up for a long time. Therefore, investors look for such commodities to buy during the war and invest in them, whose value is going to increase over time. What are these commodities? Let’s know about them with the help of this article.
Impact of War on Market and Investment Assets
During wars, there is a feeling of uncertainty that shadows the entire world and the financial markets. Whenever two countries are involved in a war, they usually put a halt on the imports and exports from the country. This doesn’t only affect the market situation in the participating countries but also affects several nearby countries. For example, in the Russia-Ukraine war, Russia has put a pause on crude oil exports to several countries including European countries like Germany. Now that there is a limited quantity of crude oil available in the country, the prices are going to increase, leading to inflation. This is how war affects the markets and investment assets.
Commodities to Buy During War
There are five most important commodities that you should be buying during a war. Here we have discussed each of them in detail.
Digital Gold
Gold, being a precious metal, has always held a special place in the hearts of people around the world. Looking at it from the investment perspective, gold offers a perfect hedge to your portfolio against rough market times. During the war, the most important and beneficial commodity that you can buy is gold. It doesn’t only increase in value over time but also helps in protecting the purchasing power of your money. In a time when your cash is losing its value, what’s better than using it to buy something whose value is bound to increase over time? Buying digital gold can bring a pool of benefits to your investment portfolio by cutting down on unnecessary costs and worrying about theft. Diversifying your portfolio with gold and silver is your go-to investment option during the war.
Digital Silver: Commodities to Buy During War
Silver has an impressive history of being used as a medium of exchange throughout the world. The fact that silver has multiple use cases besides making jewelry, makes it a hot commodity to buy during the war. Also, the negative interest rates corresponding to the cash deposits in the banks are forcing people to take their money out of banks and invest in silver. Why are they investing in silver specifically? Because silver has a global demand and is very important to China, which is one of the largest economies in the world.
This demand for silver has been pushed further by the current geopolitical crisis amidst the Russia-Ukraine War. It is not a special case. Silver has always increased in value during times of war as more investors begin switching to investing in silver. This is because silver provides a great hedge against market volatility and helps them balance out their portfolios. This surge in the demand for silver further shoots up the prices of silver.
We are mentioning buyingdigital silverspecifically here. This is due to the fact that digital silver has several additional pros over physical silver as an investment asset. Digital silver doesn’t require you to buy special lockers to store your assets. There are no additional fees to be paid for lockers.
Blue-Chip War Stocks: Commodities to Buy During War
Blue-chip stocks belong to companies having market capitalization in billions. Such companies are well-established, financially stable, and have dependable earnings. Investors investing in such companies usually earn high dividends. Now talking about the blue-chip war stocks, these are the stocks of those companies that manufacture war-time supplies like defense stocks, oil stocks, and renewable energy stocks. Reports highlight that such stocks increase in value during war whereas the stocks of companies dealing in communication and technology reduce in value.
Commodity-based ETFs: Commodities to Buy During War
In view of the current situation of Russia invading Ukraine and most countries have put a ban on supplies from Russia, commodity-based ETFs can act as a great hedge against rising inflation. The red hot commodities are witnessing a surge in their prices and will continue to do so if the war prolongs or worsens. So, commodity-based ETFs can prove to be a great investment to protect your money from inflation while stocking up on commodities. As of now, there are many commodity-based ETFs like Aberdeen Standard Bloomberg All Commodity Strategy K-1 Free ETF, SPDR Gold Shares (GLD), Aberdeen Standard Physical Palladium Shares ETF (PALL), and so on. These ETFs are mostly based on crude oil, natural gas, agricultural supplies, industrial supplies, etc. Since these industries are evergreen and stay in demand even during the war, they are the best investment options.
Daily Commodities
During the war, the prices of daily commodities like fuel, oil, natural gas, etc. increase. As inflation hits, the purchasing power of the money decreases, which leads to an increase in the prices of daily public commodities. Therefore, experts advise investors and common people to stock up on these commodities and prevent their money from losing its purchasing power. You can also buy commodities like gold and silver jewelry, other precious metals like palladium, platinum, copper, and so on.
Conclusion
In view of the ongoing war between Russia and Ukraine, investors should buy digital gold and silver to hedge their portfolios. It is because such situations can lead to fiat currencies coming crashing down. Consequently, gold and silver are going to act as future money. Start investing in digital gold and silver today with OroPocket.
