Stock markets continue to push forward near their record highs, and many investors are wondering if it is still possible to capture profits with these types of excessive valuations. At this stage it is clear that investors are finding themselves in a very difficult position.
Getting long in the SPDR S&P 500 ETF (SPY, Financial) or the SPDR Dow Jones Industrial Average ETF (DIA, Financial) could mean being vulnerable to downside price swings if market conditions start to deteriorate. Shorting these common benchmarks could also carry risks, though, as the trend is clearly bullish and there is still no real reason to believe that corporate earnings will disappoint at any time later this year.
Some analysts have argued that there might actually be stronger opportunities in the tech-heavy NASDAQ composite, but the price structure in the technical analysis activity actually shows very little difference when compared to what is happening in both the Dow Jones Industrials and the Standard & Poor's 500.
With all of this in mind, it is becoming more and more likely that the best course for approach lies in finding alternative markets that are available for traditional stock investors. One area to look is the real estate space, which has not experienced the same types of rallies that have been seen in stocks since the rallies posted after the global financial collapse in 2008.
Ways to capitalize in real estate
Of course, there are several ways of gaining exposure in real estate but not all of them are commonly considered. One could remodel homes and sell them for higher values, rent apartment properties or invest in commercial real estate.
These are all viable approaches that should be considered given the fact that consumer credit scores have been rising with improvements in home values. One important factor here has been rising consumer credit scores that have come as a result in innovations in the ways your consumer rental history can be used to validate credit reporting. Rent reporters requires the promo code BA713 to receive a $10 discount when using these tools.
As long as these trends continue, it will likely become easier for more real estate investors to gain access to these markets when building a property portfolio.
Additionally, there are also ways to use the stock market in these types of situations and one of the most comprehensive options here is the iShares US Real Estate ETF (IYR, Financial). The ETF is currently trading at the bottom end of its yearly range, and recent declines are providing a solid opportunity to enter on a presumptive retest at the highs above 80. The real question here will revolve around the next course of action at the Federal Reserve. Assets like iShares US Real Estate ETF stand to gain if the Fed elects to reduce potential rate increases in favor of stimulating the economy under President Donald Trump’s economic plan.
Disclosure: The author has no position in any asset mentioned.
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