Regardless of whether you are starting your way in trading CFDs or you are already experienced in online CFDs trading, you have to figure out where the market goes in the coming year and beyond. CFDs have grown a lot over the last decade and gained popularity amongst many investors as a way to deal with the volatility and make short-term investments with a relatively low initial capital. Our partners from the Invesous.com platform prepared a detailed analysis of the market for 2021 so that you can get ready and get the most of your investments.
The Strategy for 2021
After all the market events from 2008 to 2018, in 2019, investors came to the vision of CDFs as a powerful trading alternative. That trend has been growing even larger in 2020, so the expectations for 2021 are quite optimistic. One of the many aspects that you should consider for your 2021 strategy is the type of assets you want to speculate with. It used to be an important aspect before, but it’s about to become crucial as you should be able to predict the reversal movement caused by the recession in the chosen market sectors. In addition, hedging will be of great use to protect you from unpredictable losses.
Even though the overall macroeconomic analysis may not show any dramatic twists, you should always remember that unexpected events may occur. For example, Trump’s 2018 comments on interest rates was a bomb for the market, and the selling wave was immense.
The upcoming political and economic course of the new president may lead to an avalanche of unpredictable and hardly-predictable events. Biden’s economic approach will be very different from Trump’s, and you shouldn’t wait for new compromises for high-grossing economic sectors. Wait for the opposite. On the other hand, the market may benefit from a softer foreign policy.
In 2021, governments worldwide will keep fighting gas-powered cars in order to lower pollution. This means that Tesla, lithium battery manufacturers, and lithium miners will keep going up. Actually, this trend is the most long-playing so far. In addition, TSLA is going to issue more shares and cause a new uptrend.
There are only two ways for the course of events. The optimistic prognosis says that the disaster will end by June due to a booming increase in vaccine production. Analysts say that the vaccine can stop the spreading in less than 100 days. The negative scenario says that the third wave will occur because of the new strain of the virus that’s been noticed in GB.
Almost all cryptocurrencies have strengthened a lot in 2020, while Bitcoin has tripled. This means that you should keep an eye on this sector as it may bode numerous lucrative deals.
The Fukushima disaster memories are already fading, and uranium prices start to grow. For example, Cameco (CCJ) went up by 40% in December! Smaller uranium producers are also expected to grow in 2021.
Bond Prices Decline
The bond market is expected to drop prices along with a rapid inflation growth that are likely to take place in 2021. The trend is already clear in the UK if you take a look at the negative rates.
The Year of Answers
2021 will give us the main answers to understand what waits for us until 2026. We cannot say if the pandemic ends, if Biden’s course leads to economic disasters or not, etc. Still, it’s clear that CFDs are going to strengthen as an instrument with convenient risk-management and hedging. Experienced traders will win a lot using the leverage accurately.