The year has started with interesting news in the stock market. With rising opportunities and an attractive market, there is a need to consider the risk of certain investments as well as which are the assets and stocks that are expected to perform well.
While trading online remains popular, the brokerage industry has experienced a slower trend, especially when it comes to the opening of new accounts. Still, the income from online trading remains high, meaning active traders and investors are engaged in the buying and selling of shares, and predictions seem to indicate more and more people will start trading this year.
Risks and opportunities in online trading in 2022
Even when the whole drama derived from the covid pandemic becoming a memory, there is a potential of the virus developing into a new variant that may have a strong impact on the world economics. Since the market is sensitive to world major events, a new variant of the virus could cause a new debacle in the market.
Another topic that has come up when talking about risk in the stock market is inflation. 2021 saw raising inflation towards the end of the year. However, it is expected that if things continue the same way, inflation may remain at the standard 2%.
The last big event that seems to represent a risk to the stock market is the developing situation in Russia and Ukraine. A lot of traders are just taking their time analyzing the situation and looking for details that would indicate the direction the market will take as the situation moves forward.
So, what are the opportunities for new traders or experienced ones in 2022?
Certain industries are expected to perform really well in 2022. Among these, we see the oil, gold, autos, and services industries, as well as the housing sector. These may be interesting areas to invest in during 2022 since growth is expected. Traders should remember to keep a diversified investment profile in order to buffer the risk that comes from investing in the stocks market. Spreading their shares among these potential industries may be a good way to maximize traders’ chances to make a decent profit in 2022.
Other opportunities come from the great offer of the brokerage industry. As more and more people become interested in online trading, brokers are becoming more inexpensive with very low commissions or even zero fees.
Winners and losers, predictions for the stock market in 2022
One of the main trends we see is the continuous rise in the number of new traders, mostly influenced by a recent awareness of how inflation is reducing the buying power of their savings.
Inflation has driven more and more normal people to invest their savings in order to make a profit that will compensate for how quickly money loses its value in a savings account, for example, where the interest paid doesn’t cover the loss due to inflation. This influx of new traders brings in a whole new sector and capital into the stocks market.
Finally, a prediction that traders should keep in mind for 2022, is the one that estimates that trading options will dominate the market this year. Since the market in 2022 seems to be mostly dominated by newer traders, and buying and selling options are a great strategy for beginners, it’s believed that options are going to be more popular and probably an interesting area to make a profit.
The main reason behind the popularity of options among beginner traders is due to the fact that there is no commitment to buy. If the prices don’t reach the stipulated price, the order simply expires.