Trading has seldom been an option for anyone but banks or stockbrokers, but with changes to trading laws and a plethora of online trading platforms now available, the opportunity for the wider world to trade is now very real.
This is fantastic news for your business.
Due to the lack of trading or investment opportunities for the average business in recent history, the prospect of generating additional revenue from trading still sounds outrageous to many entrepreneurs or business managers.
However, it is now a viable financial strategy which could pay dividends (both literally and figuratively) in years to come as the global economy endures one of the most turbulent periods in recorded history.
Sitting still and allowing factors like inflation, fluctuating asset prices, and consumer behavior to dictate the balance sheet of your business is a flawed strategy. Recent events like COVID and the war in Ukraine have demonstrated how vulnerable the economy is to unforeseen problems, so you should take your corporate finances into your own hands.
Here are three reasons why your business should trade:
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You Can Diversify the Assets You Hold
One of the most compelling reasons why your business should consider trading as a financial strategy is that you can diversify the assets you hold.
Many business owners lack wider financial education about the asset classes they could hold, which results in them keeping much of their balance sheet in whatever currency they trade in.
This makes sense, but given rising inflation levels, it is becoming less viable.
A great example of a company which has achieved new heights of fame and fortune as a result of a single trade is MicroStrategy.
The tech firm converted much of its balance sheet into Bitcoin between 2021 and 2022 after founder Michael Saylor realized how quickly the business’s money was melting away due to inflation and a slowly debasing US dollar.
MicroStrategy benefitted hugely during the crypto bull market of 2021 and has continued to accumulate Bitcoin ever since. It is now the company with the single largest amount of Bitcoin worldwide.
This example demonstrates the power of diversification. If you want to start researching various asset classes to trade in, check out Terra LUNA live price charts.
You Can Increase Your Business’s Net Worth
Another key reason why your business should trade is that it could increase its value and generate significant added revenue. The benefits of this should not be underestimated.
If you are going through a rough patch with your business, then you can shore up your balance sheet by trading in assets which are enjoying more favorable times. This smooths out your cash flow and ensures that your business maintains a healthy profit margin all year round.
What’s more, you can reinvest this money into your business, improving your products, boosting your marketing budget, and ensuring the company itself is generating you more money, more of the time.
It Keeps You in Touch with Other Industries
An additional reason why you should consider trading with your business is that it links your enterprise with other, unrelated industries.
Every company is limited by the industry it operates in, but when you trade with other sectors, you effectively spread your business across a wider market, ensuring a greater level of stability and success.