The Covid-19 investor approach
I’m purely writing this for those of you thinking, “So what’s smart to invest into now?” Due to the general theme of our inbox requesting to be “more current material”, well then here you go!
I see the markets in 2021 and it looks like several pieces of cakes which don’t look too fresh anymore. We have the stock market riding high, though the logic behind it is missing. We see commodities such as gold and silver stagnating after a significant year in 2020, virtually going nowhere at current. However, we see cryptocurrency breaking a few realms to reach new records (Well, Bitcoin at least). One of my long term plays in Ethereum back in 2018 paid off handsomely and that motivates me to write this piece as well.
I asked myself again, do I actually believe in this crypto nonsense? Honestly, I never understood it much nor did I believe in its sustainability. So why did I invest? It’s basically the portfolio mentality… if it is there, if the risk/reward looks good, what’s the harm of putting some money into it? For me if a stock had rocketed the way Bitcoin did to over $19000 and fallen back down to frail $3500, it would look like a penny stock. Not a blue chip. However, at this time if cryptocurrency DOES have its use and benefits in our world… the risk reward of going into it at its lows was incredible. Think about it, how many ‘penny stocks’ are in the crypto world? A tiny miniscule fraction of the number of ‘penny stocks’ in the stockmarket, which made me pump a modest $5000 into Ethereum back at $135. Mind you, I told myself a few times “Most likely this is goodbye” to my $5000. It didn’t bother me too much since that money makes no difference to my life.
Fast forward 2 years to January 2021 and I have something to smile about for a bit. Not because I made a ‘wise investment’. Not because I was smarter than the rest of you. Definitely not because I “worked hard” for it. It was simply playing the risks the market was offering at the time. Did I join the herd in buying into “land” and “property” back then? No, I learned that following the herd gets you paying the bills and generally running the rat race. The herd never notices the gold nuggets in the ground. No, those are eyed by the big playing hawks in the sky… and all we need to do is watch where those hawks tend to lead the herd.
Finally, what’s attractive today? Well that one is for you to figure out. Use my Ethereum story and look out for what’s on ‘offer’ today. Certainly not Apple or Tesla.