4 Investments To Avoid In 2014

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2014 is upon us, and there are many theories about what the big gainers will be in the coming months. Most of those lists concentrate on the most sensational of investments. Those investments, while offering the potential for huge returns, are high risk, and they’re bad for everyday people trying to put their money somewhere relatively safe and reasonably likely to grow. Most investors should stay away from these top four.

Tesla Motors

What is it? Everybody with an eye on the market in 2013 is familiar with Tesla Motors Inc. (NASDAQ:TSLA). The company more than quadrupled in value over the year on the back of better than expected electric car sales, and analyst exorbitance.

Stay away because Tesla Motors Inc. (NASDAQ:TSLA) is an expensive stock. The company doesn’t make much of a profit, and there is no guarantee its solution is the best, nor is there any safety from controversy like the Model S fire debacle.

Only invest if you’re willing to lose it all, and you have faith in Elon Musk’s electric vehicle dream. Tesla Motors may well change the world, but it’s only a good investment for those willing to take a risk on something they believe in, like Musk himself.

Gaming

What is it? 2013 was the most gaming centered year of all time. The release of new consoles from Microsoft Corporation (NASDAQ:MSFT) and Sony Corporation (NYSE:SNE) sits alongside the release of blockbusters like Grant Theft Auto V, and the advent of free-to-play success on mobile.

Stay away because nobody knows what they’re doing, and nobody’s even sure gaming is a real profit maker. It took decades to work out a way to make good money off of movies, and it may take longer to figure out gaming. Both hardware and software are volatile and difficult to predict.

Only invest if you’re willing to take a risk. Like Tesla Motors Inc (NASDAQ:TSLA) investors, you should stay away unless you’re passionate about gaming and want to invest in something you care about.

Weed

What is it? Marijuana is becoming a massive business for the first time, and there is certainly money to be made in the business. Colorado opened its first Weed shop this week, and investors have been trying to get exposure to the drug for months, reigning down massive penny stock hopes.

Stay away because penny stock are worth very little because the companies they represent don’t make money, and have little potential to do so. Marijuana enthusiasts may not be the first people you’d like to follow into a bet in the first place.

Only invest if you are one of the aforementioned enthusiasts. Some of the Marijuana companies will be successful, but right now there’s little telling which ones and the risks in the industry are monstrous.

Bitcoin

What is it? The cryptocurrency is one of the words of the year. Headlines about regulatory approval and newly minted millionaires have appeared with regularity and some are predicting a boom in decentralized money in the years ahead.

Stay away because Bitcoin is not a store of value. It’s an incredibly volatile way to hold money, and that makes it a really poor investment. There’s tens, if not hundreds, of alternatives that may improve on the original, and regulators may yet decide to bind the use of Bitcoin.

Only invest if the rest of your money is in lottery tickets and the South Sea Company.

Disclosure: Author represents that he has no position in any stocks mentioned in this article at the time this article was submitted.