Every four years, we get an extra day to keep our calendar in sync with the cosmos. That day is today, February 29, which strikes me as a good time to reflect on the past four years.

Coincidentally, it has been four years since the outbreak of the coronavirus pandemic upended the global economy. Since then, stocks and bonds have been subjected to a whirlwind of interest rate cuts and hikes.

Nevertheless, the financial markets have held up remarkably well. This month, the S&P 500 Index closed above 5,000 for the first time ever and is up more than 50% over the past four years.

There’s a lesson in there somewhere. Sometimes, we become so engrossed in the here and now that we lose sight of the big picture.

I think something similar is happening now.

To be sure, the wars being fought in Ukraine and the Middle East are serious business. Human lives are at stake, as is the sovereignty of the nations involved.

That may still be the case four years from now, just as COVID-19 persists to this day. In fact, the virus will never go away as long as there is an animal reservoir to keep it alive.

Even if COVID-19 is somehow eradicated from this planet, its impact on how we work, shop, and play in the United States will live on:

• The office vacancy rate is nearly 20% and still rising.
• Retail e-commerce sales are projected to grow at a 12% CAGR (compound annual growth rate) over the next four years.
• Online video gaming is now a $100 billion market.

Zooming Out

Shortly after COVID-19 arrived on our shores four years ago, I suggested “3 Hedges Against the Coronavirus Crisis.” I opened that article by opining, “It may be weeks or months until the full impact of the coronavirus outbreak is known.”

That declaration seems comically understated now. But at that time, it was not clear how much further it would spread. I did acknowledge, “Many investors are wondering how they can hedge their portfolios against the possibility of a global pandemic.”

In that article, I suggested that investors increase their exposure to gold and biotech. I viewed them as “proactive moves you can make to protect your investment portfolio from the economic risks associated with the virus.”

That turned out to be good advice. The two exchange-traded funds (ETFs) I recommended performed well over the following year.

The ProShares Ultra Gold (UGL) ETF gained 19%, while the iShares Biotechnology ETF (IBB) rose 42%. Over the same span, the SPDR S&P 500 ETF Trust (SPY) was up 20%.

But since then, the stock market has gone on to new heights while gold and biotech stocks have leveled off. As I said earlier, there’s a lesson in there somewhere.

I think the lesson is this: trade a crisis, but don’t invest in it long term. Think about all the “work at home” stocks that have crashed after soaring in the immediate aftermath of the pandemic.

The poster child for that phenomenon is Zoom Video Communications (NSDQ: ZM). It peaked above $500 a share in October 2020. Last week, you could buy it for $62, the same price it was at five years ago.

Look Before You Leap

As I look ahead to the next four years, I wonder what trends will dictate the stock market’s performance. Right now, artificial intelligence (AI) is all the rage.

In October 2022, I added AI chipmaker Nvidia (NSDQ: NVDA) to the Personal Finance Growth Portfolio at $115. This week, it traded above $800 for a gain of more 500% in just sixteen months.

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Before that, the electric vehicle (EV) industry took Wall Street by storm. In the two years leading up to its peak share price above $400 in November 2021 (split-adjusted), EV manufacturer Tesla (NSDQ: TSLA) appreciated more than 1,000%.

But now, the Environmental Protection Agency is contemplating rolling back tailpipe emissions limits. Turns out, consumers aren’t adapting to EVs as fast as carmakers can produce them.

Perhaps we will eventually decide that AI isn’t the cure-all that many think it could be. There may be a place for human intelligence in the future, after all.

My advice is to think twice about the stories dominating today’s headlines. Look before you leap into trendy investments that will be old news by the time the next leap day rolls around in 2028. Instead, focus on proven methods for building wealth over the long haul.

As you position your portfolio for 2024, don’t ignore alternate investments, such as cryptocurrency.

Consider this fact: the “blue chip” of crypto, Bitcoin (BTC), gained 156% in 2023. BTC and the broader crypto market have embarked on a new bull market this year. In fact, crypto is red hot.

Every portfolio should have exposure to crypto. But you need to be informed, to make the right choices. Start receiving our FREE e-letter, Crypto Investing Daily. Click here now!