Best places to invest your money this year

Just because the financial crisis is over, that does not mean the markets have calmed down or that investing has become any easier, which is one reason most investors stayed on the sidelines for the past year, preferring to play safe via fixed income.
Meanwhile, volatility appears to be here to stay. The past year saw some investors gain and others loose depending on where they had invested.
From equities to real estate, diversification is the key to finding top returns.
In the first quarter of last year, we witnessed an unprecedented surge of stocks of every size and sector. And that performance came on the heels of the 20 share index —hitting all-time lows.
The best way to brace yourself for the ride is through diversification of your portfolio. Just because the financial crisis is over doesn’t mean the markets have calmed down or that investing has become any easier.
Obviously no one knows for sure what’s going to happen in the second, third or fourth quarter of the year because so many unpredictable variables are at play.
Real Estate
Perhaps the two most common ways or places to invest money starts with property investments. Property is a great thing to own, because it generally gains value, and you can make even more money by building a business on the property, turning it into a rental property, or perhaps even flipping it.
Buying houses with intent to sell it for profit is probably the most popular, because it seems to net a great deal of profits while allowing you to show your creative side. People buy houses and properties for cheap, and then remodel them and resell them.
With the Nairobi Metropolitan master plan development, we are set to witness unprecedented growth in real estate.
As an alternative you might decide to own property directly. Look for an up-and-coming neighbourhood. Also, look for places that are being re-vitalised because that is where you are likely to see properties appreciate.
If you are interested in owning investment property start slowly. Make a small investment to see how it works.
Stock and bond marketThe second place is to invest in the stock market. While many people fear the stock market, there are many stocks and companies to choose from that offer different levels of risk.
While higher risk levels will garner biggest returns, one can still make a great deal of money with the low risk stocks. After disastrous performance of the stock market in the first quarter of last year and record low interest rates, analysts sense that investors are open to new investments that promise opportunities for better returns this year.
Here is the deal. Global economic output is pretty picking up and that means returns are likely to be modest until things get better. Further Kenya’s economic growth and performance outlook according to World Bank is projected to hit five per cent plus this year.
I think that’s the story frustrated investors want to hear, and it’s easy to attract new money if you tell that story.
There is every indication that our stock market is on the recovery mode despite the market taking a beating early last year. Investors are advised to include in their portfolio stocks that have strong cash flows, solid balance sheets, and high dividend payouts.
Leveraged Investments
If you cannot make much money using your own money, then you can of course make more money by borrowing someone else’s money.
That’s the basic idea behind all sorts of leveraged investment strategies, from leveraged private equity funds to leverage bond funding to leverage real estate financing.
To my knowledge, there’s evidence that borrowing money and betting on the direction of various markets has a reasonable probability of working out for you. In fact, most of the time it works out pretty good for savvy investors.