Diversification in investing is always important, and a good plan with clear goals is necessary. Here’s a brief overview of what can be expected in 2024 in the capital markets.

Clearly defined goals and plans should be the foundation that every investor should jot down before investing and have it clearly set from the beginning. Every new investor faces the biggest problem with fear and greed, which can break them on the market until it does, usually at the most unfavorable time for them.

Eliminate emotions and rely on numbers.

Deciding how much to invest and how to allocate your investments should be in line with your goals and preferences and what you want to achieve.

Stay realistic because extremes in expectations, whether too low or too high, will put you in a worse situation than before you decided to start investing.

The weakening of your purchasing power, geopolitical events urge us to take action to preserve the value of our hard-earned money and assets. Bond markets have already factored in future interest rate cuts into bond prices by the end of 2023, so returns could be lower.

On the other hand, in equity markets, one should bear in mind the high returns that were seen in 2023, generated by a relatively small number of companies holding large proportions in equity indices in global markets. This is why most analysts expect single-digit growth.

It is worth mentioning the cryptocurrency market, which is always highly volatile and carries high risks but can also bring significant profits in 2024 and 2025, especially with the arrival of Bitcoin ETF funds, bringing new investors and new capital to the market, and thus the growth of cryptocurrency market capitalization, which is still very small compared to other financial markets.

We will certainly follow the FED and ECB and their decisions regarding interest rates and how they will affect commercial banks and the quantity and permissibility of money, which will largely dictate what the financial landscape will look like in 2024.