Portfolio diversification is one among the important thing tenets of investing. Multiple studies have shown over time that spreading your assets across different investment types and styles lets you best navigate the markets’ ups and downs. The thought is that if one asset type or investment style is just not in favor at a selected time, one other type likely shall be, thus balancing out your returns.

For instance, stocks have been hot recently, but they but could also be slowing down. Meanwhile, bonds have been a mixed bag, cryptocurrency has been surging, and gold has been strong, although we remain in a real-estate winter. Thus, a diversified portfolio would serve you well right away.

Nonetheless, looking ahead, what do Americans see as the very best long-term investment? A latest poll from Gallup has the answers.

Real estate and stocks rank at the highest

This week, Gallup released its annual Economy and Personal Finance survey, which polled Americans from April 1-22 about what they see as the very best long-term investment amongst stocks, bonds, real estate, cryptocurrency, gold and savings accounts.

Despite its problems over the past few years, real estate remained the highest selection, chosen by 36% of participants as the very best long-term investment. The true-estate market has slowed to a crawl for a wide range of reasons on each the business and residential sides, with two of the most important reasons being high rates of interest and soaring prices. Real estate has only recently shown signs of recovery, but uncertainty remains to be high.

Perhaps investors are hoping that the market has hit bottom. Nonetheless, that 36% share is down from 38% a 12 months ago and the bottom percentage since 2020.

Stocks got here in second with 22% of the vote. Confidence within the stock market has risen since last 12 months, when just 15% of those polled by Gallup favored stocks. Stocks are more favored by upper-income Americans (31%) than those with lower incomes (14%). Middle-income earnings are in the center at 21%. Stocks are within the midst of a bull market, and while things could go sideways if the economy slows, there’s likely hope that lower rates of interest will spur more growth.

Gold got here in third within the poll, with 18% favoring it as a long-term investment. The gold market has been strong lately, because the yellow metal’s price has climbed about 15% 12 months to this point and about 20% over the past 12 months as of May 16, even though it has flattened out over the past month. Some analysts consider the outlook for gold is that the market should remain robust through 2024 and into 2025. Nonetheless, the 18% share of Americans seeing gold as the very best long-term investment is down from 25% in 2023.

Cryptocurrency and bonds lose ground

Savings accounts, including CDs, got here in at 13%. While these accounts don’t offer much upside, they’re protected investments which can be preferred by lower-income (20%) and middle-income (15%) Americans, in comparison with just 7% of upper-income earners.

The bond market has been a mixed bag, with money market funds and short-term bonds doing well on this high-interest-rate environment, while longer-term bonds have struggled. Only 4% of Americans within the poll called bonds the very best long-term investment, as more conservative investors appear to prefer the relative safety of savings accounts in a higher-interest environment.

Cryptocurrency was only added to the survey two years ago, because it is a comparatively latest asset class. Only 3% within the survey called it the very best long-term investment, which is just not surprising given its volatility over time and the indisputable fact that not as many Americans are as conversant in it in comparison with the opposite options.

That said, in last 12 months’s survey, 4% of Americans chosen cryptocurrency as the very best long-term investment, and two years ago, crypto’s share within the poll was at 8%. The decline this 12 months is somewhat surprising, given the resurgence of nitcoin and other crypto investments over the past 12 months, but perhaps some expect it to fall back after the large run.

This survey is illuminating as a snapshot of what Americans are desirous about investments, but as stated on the outset, the very best strategy is a diversified portfolio that features all or several of those asset classes.