Addition with high culture, financial problems with no visible solution in the short term and, soon, elections. This is the perfect storm involving Brazil, but it causes nightmares especially for those who have investments in the country. The approach of the election season already tends to cause discouragement for some and a sense of opportunity for others, but the uncertainties seem even greater in 2022.With Selic above 6% and forecasts of exceeding eight percentage points soon, many are in doubt about which would be the best companies to invest in. Even the most academic experts and famous YouTube and Instagram influencers are avoiding giving too many opinions on this subject, precisely because of the increase in the so-called “Brazil Risk”.
Why will the election be measured and will it be measured in investments? Whenever there is a possible change in the political scenario, it is common for any variable investment to have positive or negative movements beyond normal. In the following elections, however, we have a much more uncomfortable scenario.
The growing popularity of current president Bolsonaro is compounded by the fact that his opponent, Lula, despite the possibility of a good victory, still does not please a large part of the population. Furthermore, there are many groups on both sides who want not to accept a result that does not correspond to what they want, which also causes political turmoil.
Any and all instability in a country causes changes in investment values, and this high risk has made investors cautious in their decisions. However, this does not mean that there are no good investment opportunities.
What are the best investment options currently? There is a perception among some investors that fixed income will become a good option in these difficult times. It is true that Selic is forecast to reach 8.5% at the end of 2022, but we must remember that inflation is already forecast to reach 8.35% at the end of 2021. In other words, the real profit is zero or even negative.
Don't be fooled. Although there is no change in fixed income with fixed tenure, it is still variable income that has better investment options, especially in this turbulent scenario. As important, we can mention:
Stocks – by investing in companies in legacy sectors, investors know that as soon as the storm passes, however long it lasts, their profits will appear. FIIs – real estate investment funds tend to devalue when the Selic rises, proving that it is a good investment in the long term. Options - options allow those who actively study this type of investment to profit even when the market falls in the United States ETFs - While Brazilian ETFs are limited and do not share dividends, those offered in the United States guarantee your gains and have unlimited options. .
Best short and long-term investments for 2021 If you are thinking about the short term, there is no other way than to stick to fixed income. It is possible that the best investment to obtain profit in the short term is in options, but it is necessary to invest prospectively and with knowledge. As we said before, they allow you to play at the falls, with the right guess.
In the long term, a balanced portfolio will certainly give you peace of mind, as long as the riskier assets are held in small quantities. For example, the combination of shares and FIIs results in good diversification in Brazil. With the addition of ETFs, part of your portfolio no longer suffers from the much-cited Brazilian risk.
Road to and beyond 2022 Brazil and former investors have seen all kinds of sudden moves due to internal uncertainties. Even the youngest ones have had a unique experience with a series of bike wreckers resulting from the pandemic. Therefore, the best way is to have a safe portfolio for a long time and, once you have the knowledge to do so, work with the business to obtain benefits in the short term.