Recommend exposure to Bitcoin...

Discussion in 'Risk Management' started by Leob, Oct 23, 2021.

  1. Leob


    Shell I Ignore Bitcoin in my portfolio?
    Is it responsible to ignore it?
    Even more then 10%?
    5 years form now.
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  2. 2-10% depending on your risk tolerance...could be worth a lot, could be worth 0. However, adoption and uses are rising, so for now it seems like it has staying power.
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  3. Tokenz


    What would be the worst situation?

    A. Buying Bitcoin and losing money?

    B. Sitting on the sidelines with no position while Bitcoin travels to the moon?

  4. A
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  5. fan27


    I am treating as I would any other trade...risking no more than 1.5% of account equity. That meant scaling up from lower prices, keeping a very wide stop on the position.
  6. johnarb


    Not financial advise, but 25% or higher

    [disclosure: I only have investment exposure to bitcoin (and crypto)]

    Search Greg Foss on YouTube, he's a 30-year bond trader turned bitcoin maxi as he has good insights on the problems with 60/40 portfolio and bonds in general

    How bad could bitcoin be when Microstrategy has put all their cash (and even borrowed) to own $7B worth, the MSTR CEO himself put hundreds of millions of $ of his own money in it, Tesla has billions invested in it, Square has invested hundreds of millions of $ in it and many others worldwide and even a whole country as El Salvador has invested in it (plus made it legal tender)?

    It would not be a good idea to have 0% allocation to bitcoin, imho, but long term hold of 5+ years

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  7. NoahA


    My hunch is very little in BTC to be honest. People say it will go to 100K, ok, but that is only 2x from here. So many other coins will do 10x (and sadly, many have done so since just January). If you're worried crypto going bust, then your alt coins along with BTC will also go bust.

    Find a few coins with good potential, and spread out your investment to about 5-10. Also look at coins you can stake to earn income while you hold them which can be easily 5-10%.

    BTC might be a store of value, but the entire crypto space, if successful, will revolutionize finance, so there is way more upside in other stuff.
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  8. johnarb


    This is not a thread for bitcoin/crypto get-rich-quick that's why it's on the Risk Management forum

    It's also the reason I recommended Greg Foss, a veteran bond trader, and not some other bitcoin/crypto macro investors like Raoul Pal

    bitcoin 2x return you're talking about is for short term, but 5+ years of bitcoin could be higher and more importantly will provide an uncorrelated asset in the portfolio for risk mitigation purposes
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  9. NoahA


    See, I would argue the opposite. Since the crypto space might drop dramatically, it maybe doesn't matter if you hold something perceived safer as BTC vs. a new up and coming coin. If the risk of a 90% drop remains for both BTC and alt coins, but the chance of 10x is higher for alt coins, it almost makes more sense to do this.

    Look at it this way. I have a friend who is a TSLA bull. In from about 500 or 600. After it hit 900 and started dropping, he got scared, but still held on as it hit a low of 550. Now of course he is happy. But what's a move from 550 to 900 really worth anyway? You're married to a stock for a 60% gain which some say is way over valued. And the entire time he missed out on 1000% gains in crypto. He had just as much chance of TSLA going down to like 100 or 200, but zero chance of it doing 10x.

    The asymmetry of the alt crypto trade is I think the safer choice vs. being in something with a cap on gains but open just as much to losses.
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  10. VicBee


    If I understand you correctly, you're saying if you're going to take a risk for reward, might as well take the greatest risk for the greatest reward.
    #10     Oct 23, 2021
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