Best Places to Invest $100,000 in 2024

If you can invest $100,000 in 2024, you could pave the way to financial freedom. Here’s more good news: The amount is any amount. All you have to do is invest wisely.

No one knows whether the market will continue last year’s upward trend in 2024, stagnate, or retreat. But no matter what happens, a well-considered portfolio can help you manage and even win this year. Put in place the elements you need to win in the long run. Below, we’ll talk about how to invest your six-figure nest egg this year. But you can follow the same plan with a much smaller investment.

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comfort with risk

It’s important to consider some basics first, and this starts with understanding your comfort level with risk. If your priority is growth and losses keep you up at night, you may be an aggressive investor and pursue high-risk/high-reward opportunities. If you prefer slow, steady returns or are worried about losses, you are a cautious investor and should avoid high-risk investments.

Both investment styles are perfectly fine and can yield significant profits down the road. However, to make your investing experience enjoyable, it is best to stick to the style you are most comfortable with. This will guide your choice.

We’ll talk more about this later when we discuss where to invest this year. First, let’s learn about another basic: diversification.

Unless you’re an investment expert with a compelling reason to focus on just one area, it’s usually best to spread your investments across a variety of stocks and industries. That doesn’t mean you should invest in something you know nothing about. For example, if you don’t understand biotechnology and aren’t interested in learning about it, you may want to avoid that field and diversify into other industries.

Why should you diversify? That’s because if one stock or group of stocks in your portfolio falls out of favor, you can compensate and limit your losses with other investments.

A bull market is coming

Now let’s get to the interesting part. Where should you invest $100,000 (or less) in 2024? Bear markets eventually lead to bull markets, and considering the index has reached bear territory for 2022, it’s fair to say a bull market is coming. To prepare, it’s a good idea to pick some growth stocks because they typically thrive in this kind of environment.

A prudent investor may choose to invest. handful Work here and invest the money you need to favor growth stocks that have proven themselves over time. apologize (AAPL 0.57%) or alphabet (GOOG 0.87%) (google 0.94%) – Revenues and stock prices have risen tremendously.

AAPL data from YCharts.

If you are an aggressive investor, you may decide to invest a much higher amount in this sector. You could also try a few younger growth stocks, such as cell engineering companies, that carry more risk but offer greater profit potential. Ginkgo Bioworks Or recovery stories like these: Teladoc Health. You may also consider players in cutting-edge technologies such as gene editing and equity acquisitions. CRISPR therapeutics.

Early this year, it’s a good idea to look for a few promising stocks with solid long-term prospects that may have been missed in last year’s rally. Two good examples are: modern (MRNA -0.65%) and Chewy (blow -5.72%).

Biotech company Moderna has nine late-stage programs in the pipeline that could usher in a new era of growth as early as next year. And online pet supply store Chewy has recently become profitable, increasing profits and retaining loyal customers even in difficult market conditions. These are both growth stocks, but you can also find opportunities in other areas and across industries.

Aggressive investors might consider making big bets on these laggards, while cautious investors might consider scaling back to a comfortable level.

Which stocks should prudent investors buy?

If we are cautious, what areas should we pay attention to in 2024? Consumer staples or healthcare products make great purchases that can continue to grow your portfolio over time. We often think of these companies as ‘safe’ because they sell products that people depend on, regardless of economic circumstances, and ensure some level of income stability.

Careful investors can also pick dividend stocks this year to collect passive income both immediately and over time.

This doesn’t mean aggressive investors should avoid safe stocks and dividend stocks. However, they may want to make smaller bets in this sector and use more cash to buy growth stocks.

Finally, if you’re an investor with $100,000, it’s a good idea to set aside about $10,000 in an opportunity fund. This is money you can dig up whenever a buying opportunity arises throughout the year.

How should you distribute your money among all the potential investments mentioned above? This depends on your personal comfort level with each stock, industry, and investment category. But generally, aggressive investors prefer high-growth areas, with 50% of their investments invested in growth, while cautious investors should invest most of their money in safer stocks and dividend stocks.

Finally, invest in stocks that can shine in 2024, as long as they offer the best long-term prospects. The best way to win in the stock market is to buy good stocks and hold them for the long term.