Revaluating Your Upside

in investing •  last month 

Hey Jessavers

I've been working for eight years now since I left Uni, and unlike most of my peers, I saved and invested most of my capital always trying to find a new play for my cash. I couldn't understand the maths behind all the consumer spending and the value of my labour being eroded so quickly. Yes, I would have liked to have saved more had I known what was going to happen, but I'm happy I chose this route.

I'd still call myself a newbie investor I mean I've only had a cash flow for eight years so finding out what to do with it become a second job. I first bought stocks in the local stock market, dividend-yielding ones because I wanted a passive income I didn't want to have to trade to a greater fool for a profit. Then I started a preservation fund, A retirement annuity, unit trusts and index funds.

All pretty standard boring low-risk stuff, although I did try to get into the most volatile of the index funds, relatively speaking.

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What I began to notice is the return on those investments were not that great, and I started to look at moving my new capital into other areas.

Property

What I saw in the housing market, is the idiot's way to invest, with so much capital chasing a set amount of goods, housing became a bubble, its way overpriced and in fact when you run the numbers put you further in the hole once you remove all the hidden costs and inflation.

The only reason people like it is because they look at the nominal value increase, they hope for a greater fool to sell it to, and they think physical assets mean something, which is a fallacy in itself.

Bonds

Bonds are at an all-time high and would I want to risk my capital on the solvency of a government or their ability to issue new debt to pay mine, robbing Peter to pay paul and hoping tax receipts make it back to me for a steady income? The bond market is under severe pressure, and we've already seen European bonds go negative, and it won't be long before the rest follow.

International stocks

We all know this has been a significant fraud, I mean bull run, yes you can make money but is it worth risking your capital waiting for the fed to keep propping it up and then selling your stocks to what will eventually be you paying it back through tax? I'm not so sure I feel morally compelled to get into investing in zombie companies.

Credit markets

Well, we don't get access to this as retail investors, and you'd have to go through a brokerage and pay fat fees for doing so and even then, you'd need to come in with a considerable amount of capital.

While the central banks are moving this on to their balance sheet those who owned credit like corporate bonds are now safe, but the ones who want to come in now are buying risker and risker junk bonds, not my cup of tea.

Commodities

This market needs some studying, its highly cyclical, and if you don't get your timings right, you can get creamed. We all saw what happens when oil went negative, and did you want to be the one stuck holding the bag? I think there's still tremendous upside here if you have the time and know what you're doing.

Precious metals

Precious metals are the insurance policy on fiat; It doesn't go up in value; it only protects your value against debasement. Gold and Silver will continue to make all-time highs against all major currencies, and I can see it going 2,3 even 5x in price. It's a great way to have a risk-off approach to what's going on, with bullion or coins.

Bitcoin and cryptocurrency

Bitcoin to me is the fastest horse in the race it got what? 10x, 20x even 50x potential? The asymmetric upside is huge, and it's why I continue to average in and put more of my wealth into cryptocurrency, well mainly BTC. I do take a few long shots with alts, but mainly BTC is the only thing worth buying when it comes to storing your wealth long term.

I see BTC as an insurance policy on whats going on in the fiat market and an option/shares in a new financial system if and when we need it.

Have your say

What do you good people of HIVE think? Where are you hedging your bets

So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."

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Guess it depends where bitcoin gets its value. I'm not hodling bitcoin. I got out after reading up on the Hash Rate Death Spiral.
Kinda scared me how little I understood. I'm all in quality alts now.
If bitcoin goes up I win a month later anyway. If bitcoin goes down, I don't lose.

I read about it and it’s a valid concern I just think that the protocols difficulty adjustment will factor it in all the way down as it would all the way up and there will always be miners of last resort!

If BTC goes to 0 the whole crypto market goes with it unfortunately so for the interest of Alts they may even come on board to support BTC

I’m also in a range of Alts come have value some are just market sentiment and I’ve picked it based on reasons I feel will have potential upside!

Yes alts have a major liquidity problem so when rally’s come they shoot up like a rocket 🚀 lol that’s what we love and then use that to stack Sats well that’s my game plan

With the advent of bitcoin cash, particularly with cash's much shorter adjustment period, and not knowing who owned what; it just seemed like it was too big a potential threat. I'm glad it didn't pan out that way; but if it happened, there would've been no predicting when; or getting to the exits.
It's been at least 3 years since I had any bitcoin at all; and I don't imagine I'll buy any more, but it'll always be a favourite.

I think a lot of those projects all show how good BTCs defense is it takes a battering from alts and from the traditional system! I see it as my anchor and counter to anything happening in Alts! While they still heavily correlated now in future I think Alts will take in cycle of their own compared to BTC as the market matures

I’m pretty sure being risk on like you in crypto will pay off it only takes 1 coin to moon to cover losses in all your others, that’s been my experience so far

You are very observant. I liked what you said about real estate. I see so many people here putting little to nothing down and then having to pay mortgage insurance. Then they utilize real estate agents which further strips away more proceeds.

Exactly it’s not as cut and dry as you think housing is way overvalued even the tiny houses you can’t tell me the cost to build has not deflated with the amount of technology and innovation in the construction space! It’s only because banks are willing to throw money at this asset class that it erodes the gains of deflation!

As for an investment buying one to live in or hold us a gaurenteed loss, renting is a also a toss up depending on where your home is and flipping also becomes harder

The only people making money on housing is the banks, even these real estate investors aren’t making money they shipping off the loans to investment banks to package up and making off with the cash once the project or home is done

I’m not saying theirs no opportunities in real estate I just think the vast majority of it is a lie or predicated on nominal gains and a greater fool!

When all this is corrects I’d say homes should on average be worth 50% less than current prices and in some markets more like for example Canada and Australia which really went balls deep on real estate

"Well, we don't get access to this as retail investors, and you'd have to go through a brokerage and pay fat fees for doing so and even then, you'd need to come in with a considerable amount of capital."

This is one of most common way to invest beside stocks in Sweden. Get 5-10% and invest a least 100 USD. So here it is a good way. Specially when the creditloss is extremly low because the gouverment helps to bring in unpaid money.

But - I do not have anything in P2P anyway. (If Celsius is not counted)

Well I’m sure if you’re buying local debt there’s a healthy amount of tranches you can pick out that have a decent interest rate return and majority of the people have income/savings to service it! I don’t see Swedes as very wreckless lenders for the most part and with Government backing I can see the Swedish credit market to be a good place to secure good interest

Possibly another place to look would be Denmark and Norway a few safe bets in those counties too! Buy the debt!

Just not sure how the tax works on gains from these products and if it’s worthwhile investing based on what the government would take from you

Yes I agree. With a medium creditloss at 1-2 % it is still good.

Tax - as usual we have to pay 30% at winning money.
So if I get 100 USD in interest I keep 70.

In that way it is better with stocks. We have a good tax-rule buying stocks or certificate. Pay 0,8 % of the amount you holding every year - loss or win - it doesnt matter.
So if I have stocks for 1000 USD and it goes up to 1100 I pay 0,8% of 1100 in tax. That is better than this 30 % as mention above.

That's pretty strange I wonder why they have rules like that to push people into more speculative investing. Is the Swedish stock market been pumping too?

I think you are really wise in diversifying your investment! Starting young has the advantage.

!tip

Thanks and yes I agree it’s not pretty, it’s not flashy it’s not fun but it works! When you take strategies that leverage time as the value you tend to win in the long term

I avoid stocks, bonds and real estate as I see them as overpriced.
In and before an economic crisis there's the saying "cash is king".
So I just hold 3 forms of cash (as cash I consider assets usable for the direct settlement of transactions, without intermediaries):
BTC, gold and USD

As I consider these assets as ultra-safe (at least relatively to others), I am able to take a certain amount of money and put it into high-risk assets (which is Hive). This constitutes a kind of barbell strategy.

Well you’re Swiss so gold has always been your gig lol! I think you’ve got a very defensive portfolio I’m not sure how it works on your side of the world but I’m sure once it’s allowed to deflate and theirs real price discovery you’ll be sitting pretty and can pick out assets at fire sale prices at your leisure

more awesome stuff... any idea where to buy ADA, VET, or DOGE ? i think ADA will be on Coinbase soon. The others I don't see on Uniswap. ty

Sure you can find all those tokens on multiple exchanges, I've done reviews on all of them here

I would encourage you to check out @coingecko for info on where to buy coins

yeah thanks, xyzashu said the same, sorry i'm a bit slow. ADA up 500% since March, VET up 1,000%

maybe i should join binance?

You’ll need to check if Binance US has the same offerings you want as Binance for the rest of us! I only use it because I have to lol

... it looks like they do, i might sign up when i'm sober. great reviews of the alt coins, peace

Precious metals are indeed a safe bet. I think you are right with the bitcoin.. You're so good in financial stuff!

Lol I'm no financial advisor or economists but I like reading different arguments and making up my own mind

You're good at what you do, keep doing it😊

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