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Only two question is currently on the mind of all XTrade Europe traders around the world: what they can expect and what will happen on the global market by the end of 2016? It is a true million-dollar question for anyone trying to make money in the stock market. Nobody can predict what will happen in the future simply because nobody has a crystal ball. However, we still can try to understand the main trends on the global financial market and use these data for discovering new trading opportunities.
Is There Any Good News?
The good news is that almost all markets have recovered in the second quarter. This is a very optimistic news, especially when we know how terrifying opening was in the first quarter. However, we must stay focused. According to the experts from XTrade Europe, we have not reached the safe zone yet.
June was particularly interesting. We had the famous Brexit voting and always turbulent Federal Reserve meeting. And we must not forget turbulences on the Chinese market.
When it comes to a Federal Reserve meeting, people were curious about whether the heads of this institution decide to give a boost to the economy or financial market. Fortunately, their decision led to the dollar consolidation and general decreasing of investing risks.
The famous Brexit also shook the global market, but everything backed to the normal after just a few days. Of course, the British pound weakened a lot in the beginning, but it returned on starting positions after a few actions of the British national bank.
While it seems that the situation on the global financial market is now back to normal, folks from XTrade Europe still do not have a straight answer which assets class would be the ideal choice. For some, there are no ideal asset classes we can trade with. The only choice we can make here is to choose the least risky commodities, hoping that we have made a wise decision.
The second school of thought suggests that we should start buying bonds, especially those that are inflation-protected.
A third school of thought is to buy stocks, since that’s got such a long history of success.
Finally, we have XTrade Europe investors who believe that trading with classic assets such as gold or real estate is a winning combination. Experts who think these hard assets should be our priority believe that fiscal stimulus will be more important in future, compared to monetary ones.
As you can see, it is extremely difficult to say which type of commodities should be included in our portfolio. It all depends on our strategy and our expectations.
According to managers at Commerzebank, probably the best option we have in 2016 is buying all major currencies against dollar (the best strategy would be buying G10 currencies).
If you still do not know which assets you should trade with, we have a safe but still profitable combination: long EUR, long oil or even long Yen.