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In the meantime, the stock markets are also overheated

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Due to the overheated real estate market, however, there are then only a few investment options left. Sooner or later, therefore, private investors will also end up with shares. It is therefore fair to say that the low interest rate policy of the central banks is leading to more and more people (having to) invest their money in shares.

In itself, this development is very welcome: because with investments in the DAX or the American Dow Jones Index, one can achieve an average annual return of almost 7 %. On top of that, dividends amount to another 2 %. However, this is only an average value. When investing in shares, you should therefore have as much staying power as possible. This increases the likelihood that you will ultimately achieve a good return on your investment.

Due to the low construction interest rates, it is therefore not surprising that many people have invested in real estate in recent years. However, the rule that prices are determined by supply and demand also applies to the real estate market. The immense demand for real estate has therefore led to prices soaring ever higher. Nowadays, "house builders" receive very low interest rates to finance their real estate. In return, however, the prices of houses and flats are much higher than before. For this reason, one can now only advise against investing in real estate. This is true at least if you intend to use it as a financial investment and thereby achieve a good return.

Since share prices have risen so sharply in recent years, the market can now be considered overheated. Sooner or later, therefore, a major correction is to be expected. As a long-term investor, you can make good use of such corrections to enter the market at a favourable price or to expand your positions.

Profit from falling prices on the stock markets with the help of CFDs

If, on the other hand, you prefer to trade in the short term, you can download mt4 and use a CFD broker, for example. When trading with CFDs, you can profit not only from rising but also from falling prices. CFDs also have the advantage that you can use leverage when trading: For example, if you want to trade the DAX, you only need a relatively small amount of capital. Here is an example: If the DAX is quoted at 12,000 points, you need €12,000 on your trading account when trading without leverage. When trading with stock indices, however, you can also use a leverage of 1 : 20 with a CFD broker. In this case, the required capital is reduced to only 600 €. With the help of CFDs, however, you can not only trade with stock indices, but also with currencies (e.g. euro / Swiss franc), commodities (e.g. oil) and cryptocurrencies (e.g. bitcoin).

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How to find good broker

To find a good broker for CFD trading, you can use our large broker comparison. We evaluate the individual providers conscientiously and independently. In this way, you can find a suitable broker that offers you good trading conditions. With most providers, you have the option of opening a free demo account. This way you can get to know CFD trading without risk. Often, a virtual credit of € 10,000 is available for this purpose.