HODL

Mar 11 2020

Time for Discount Bitcoin

It’s been a long, long, LONG week on the financial markets. Coronavirus fears plus an oil price drop made for a one-two punch that has left quite a few people scratching their heads. Trading was halted for a bit, and the Dow dropped 2000-plus points. That was MONDAY…

Tuesday was meh and now Wednesday brings talks of a bear market having finally arrived. You name it, it’s in the red.

Crypto people thought this could mean a flight to safety for BTC and other names in the space. Wrong. Bitcoin is really not digital gold (yet) and also doesn’t have a hundred-year track record of results.

SO…we thought we’d take a look at the year-to-date charts and try to get a handle on what the first ten weeks of the year — and what the coronavirus crisis — can tell us about what the heck is going on.

Headline 1: 11.5% Up from the Low

Okay, that’s one way of looking at it. Had you timed the market exactly right and bought at the low of $6994.28 AND held to today, you’d be up 11.5%.

The low wasn’t too far from the opening price in 2020: $7203, so an 8% gain if you bought on New Year’s Day. (Compare to a volatile stock, I guess.)

Headline 2: Had You Called the Top…

Let’s use the scenario above — you buy at the low because you are really really really smart and you “called the bottom” and “bought the dip” — to show you just how you could have done: a 48.7% gain!

Headline 3: What If You’re Bad at This?

Ah, let’s say you’re not so good at calling the market. You buy at the top and sell today because you think you’re calling a bottom.

You lose: to the tune of 33.4%.

HEADLINE 4: DON’T TIME THE MARKET

If there’s one thing that people who trade stocks for a living will tell you it’s this: “DON’T TIME THE MARKET.”

And if there’s one thing that we’ve told you here a few times, it’s this: “PLAY THE LONG GAME.”

Listen, We Don’t Have the Answers…

But — and we’re not financial advisors, do you your own research, etc., etc. — it probably makes sense right now to look at your own situation before doing anything rash like buying or selling tons of $BTC. Do you need the money for something else? What about your own long-term view? Do you feel like playing the market?

It’s a crazy world — made crazier by the fact that no one really knows what will happen to Bitcoin and crypto — so you’re best to stay grounded. Don’t watch too much news. And don’t go batty trying to time any market.

Feb 16 2020

BRED vs. Balance – Which Portfolio Wins 2020 So Far?

Well, this has been an interesting few weeks, huh?

It seems, at least to this reporter, that every time you look up someone is saying “this is the LAST TIME you’ll see Bitcoin under $10,000! BUY NOW! HODL!”

10K BTC Price Movement — Okay, that’s just one week…

Well, then…this *is* quite the development, in that the $10,000 resistance level is something that CT (“Crypto Twitter”) will tell you is really really important for short-term price spikes. So maybe there is something to be said for the fact that once BTC goes above $10,000, it holds for a little and then swings downward and then who knows what happens next?

But What Does That MEAN???

As you know, we’re less about trading crypto and more about investing in crypto. It’s about long-term projects — you can find a whole host of others who will tell you about short-term gains — and we did what we thought was a pretty decent post called Playing the Long Game a few months ago.

In the interest of talking about those long-term investments, we told you a few weeks back about the 2020 Balance Portfolio. Today, we’re curious about that portfolio, how it’s doing, and whether or not it stacks up against BRED, the stalwart we started tracking in 2017.

Let’s Go to the (Crypto) Videotape

Actually, before we do that, two things. ONE: THIS IS NOT INVESTMENT ADVICE. DYOR = DO YOUR OWN RESEARCH. We’re not responsible for your success or failure or anything in between. TWO: HERE IS A SPONSORED LINK: If you haven’t gotten yourself some crypto, we highly recommend Crypto.com. That’s our affiliate link and you can get a bonus by using it if you make a qualifying purchase.

A little foreshadowing: when we wrote the post on the Balance Portfolio a couple weeks back, we didn’t think we’d see the results that we’re seeing. We thought both would be up a little — but we didn’t think we’d see the winner that we saw.

First, the 2020 Crypto Balance Portfolio:

Two rather pleasant surprises here: ONE is that ETH has nearly doubled. (And, if you were following over the weekend, it had more than doubled before pulling back; prices were north of $280 a couple of times.) TWO is a big wow around EOS. That’s a little crazy, right?

So yeah, if you had invested $10,000 in this Balance Portfolio, you’d have nearly $15,000.

And you would have lost this little contest to the BRED Portfolio.

This one popped because of two factors: ETH (nearly doubled) and Dash (nearly tripled).

Another “Wait, WHAT?” moment was the fact that a $10,000 investment would have given you an 88 percent ROI.

Evidence It’s a Bull Market?

Not one asset in either portfolio is down Year To Date. Not one.

The worst performer of any of the assets was PAXG, which is tied to the price of gold.

What can we learn from all this? Not much, actually — it’s a Bull Market and stuff is up six weeks into the year. Some of the stuff is way up.

Might be time for the “Crypto Dartboard Portfolio:” we’re not going to tell ourselves we’re any better at this than someone randomly selecting crypto projects — but maybe there’s SOMETHING to picking a few potential winners, sticking with some old stalwarts, and hoping for a positive outcome?

As always, maybe staying interested in long-haul opportunities is really the way to go.

May 30 2018

BRED Portfolio 2018 – Is It A Good Idea?

Behold, today’s update on the BRED Portfolio – a combination of Bitcoin, Ripple, Ethereum, and Dash and all their forks. When we first talked about it, the idea was an index fund of sorts – set it and forget it – with the goal of spreading out your risk and exposing your portfolio to four of the biggest coins.

Spreadsheet time: here’s what it all looked like moments ago. Note that we took $10,000 and divided it among each coin/token equally; in the case of the forked coins, weighting it based on market cap of each on 1/1/18. (That’s how you arrive at a negligible amount of Bitcoin Gold.)

Not very flattering, huh. Especially when you compare it to all the hubbub here around this ground-breaking (yet simple) portfolio idea and how it performed in 2017. You can read about that over here.

But, Should We Stick With It?

I think part of the theory here is that the market as a whole will move up and down, and these coins will track with the market per se. So it’s highly unlikely that 2018 would bring jaw-dropping returns like 2017 did, unless there’s some huge shift in sentiment. And it’s also unlikely that any of these coins will “go out of business” in 2018; though a huge pullback in any one of them COULD happen (if there’s a “black swan” type of event, maybe).

What probably makes sense – and, again, DYOR stands for “Do Your Own Research, so we’re not responsible here for successes or failures in your investments; please consult your advisors and don’t forget to pay your taxes! – might be a couple of portfolio approaches, spreading the risk out a little more but also taking advantage of some fire-sale coins that still have potential. (And having some flexibility to do ICOs, too.)

Maybe An Alt Portfolio, Too?

We talked about these earlier in the year – and all but TRX are down, with some down considerably.

There are two ways of looking at this: one is that they’re mostly duds. The other? Gems that pulled back with the rest of the market and are (at least right now) deeply discounted.

But Don’t Spread Yourself Too Thin, Either

What makes for a good “basket” approach? 10 coins? 20? 40? That’s up to you – 40 probably sounds a bit much; but there’s also a need to be able to put a little of your portfolio into coins that are new, unproven, “fliers.”

In any event, given where we are now vs. where we were last year, there’s probably some time to look around and see what’s actually out there and prepare your portfolio for any sort of froth by diversifying.

Good luck!

Jan 17 2018

Our 2018 Crypto Investment Plan

EDITOR’S NOTE: With the activities of mid-January, such as the sharp pullback of pretty much all coins, plus the crash of Bitconnect, we’ve updated this post on January 17.

Anyone else feel really blessed and ready to make it a phenomenal year?

Frankly, we feel like we hit the ground sprinting in 2018. Part of it was due to a little bit of luck, part of it was due to some planning, and part of it was due to the discipline to just hang tight for a while.

For instance, we made our own luck with a couple of timely picks; we also called ourselves HODLers on at least a couple of occasions – ones where weaker hands might have folded up the tents.

But we screwed up a couple places, too: our first ever trade with DASH meant that we took profits of 25% off the table and closed out our entire interest. Let’s never speak of this again.

Starting with a Bang

My #crypto portfolio is only up 55% since 12/31.

What am I doing wrong? pic.twitter.com/BxAqbDmFeX

— Dave Van de Walle (@Area224) January 4, 2018

We’ve gone on and on about Risk Management here. And we also feel that we’ve experimented at least enough with some concepts – you can read a whole bunch more over at the Passive Income page on this site – to at least have a firm understanding of what could work, what won’t work, and what things are worth our time.

Finally, we think we’ve gotten a good chunk of knowledge from some others on the web – especially “Crypto Twitter,” which has been a wonderful world for us so far (with thanks to some characters like @BambouClub, @crazy_crypto, @haydentiff, and @BryceWeiner, who all share their approaches to coins and tokens and various crypto ecosystems – and all bring rather distinctive POVs).

It was BambouClub himself who challenged us to put a plan to paper – and stick to it. We had the plan to paper part sketched out – but we needed to formalize it and put it in writing.

And the “stick to it” thing we’re also going to TRY to do. More to come on that…

Enough Background: SHARE THE PLAN!!!

Behold, our 2018 Crypto Investment Plan. With the usual caveats:

This is not individual advice
Invest at your own risk
Seek professional help for things like taxes, accounting, legal, and the like
“DYOR” – if you learned one acronym last year, it’s that one. Do Your Own Research.

Let’s get started with the $1,250,000 question:

Should BRED Be Part of Your Plan?

How quickly can we answer that with a resounding YES?

If you read our post from New Year’s Day, you know how well you would have done with BRED – that combo of Bitcoin, Ripple’s XRP token, Ethereum, and Dash – to the tune of wild, crazy, insane returns from buying and holding for one whole year.

This was, and still is, probably as close to a Bitcoin Mutual Fund as you can get. But, for 2018, it needed to be tweaked, to accommodate for a couple things, including main Bitcoin forks, the Ethereum fork from more than a year ago, and the crazy returns from Ripple (meaning that you are buying fewer XRP tokens than you had a year ago, because they’ve gone from penny stock to blue chip holding rather quickly). Hence:

2018 BRED Allocation — Reweighted to start the new year

We’ll answer the “how much?” question a little later; but now that the overall yes/no question on BRED is settled, we probably need to agree on an altcoin strategy, too: everything down the totem pole that could make sense to be part of the mix.

What About the Altcoins?

Our approach to altcoins isn’t random – we spent most of 2017 learning which sorts of projects appealed to us, and which ones had the potential to turn into something that replicates the success of the BRED portfolio. They’re somewhat diverse – big and small, different kinds of projects – and, as you can see from this chart, they also run the gamut from multi-billion-dollar projects to tiny-but-poised. Here’s a snapshot of our eight coins – but remember to DO YOUR OWN RESEARCH.

As we revisit some of the highlights and lowlights from 2017, we know that our biggest mistakes were when we chased quick returns and weren’t in love with the project. In these cases, we think these projects have tremendous potential, and it’s likely a rather diverse enough group to spread out our risk.

And we lucked out on a couple: ADA and HTML have both gone up at least 5 times since we bought in, and TRX was a gift courtesy of a Binance airdrop, so we held on and bought more.

Where we think we might see some real growth, though, is toward the bottom of the list. We’ve held COSS for long enough to be officially called #HODLers – “Hold On for Dear Life” – and our stake has allowed us to realize gains on a USD basis from Bitcoin’s price spike. And BURST has us so crazy excited: we were working on a blog post IN JUNE about the potential for that coin…before all of its developments.

There needs to be room in the portfolio for more, though. Let’s briefly address Passive Income next.

Our Changing Passive Income Approach

Well, the breaking news as we update this post goes as follows:

We took some lumps and lost some BTC (and ETH, and even some LTC) investing in passive income programs that went belly up. One saving grace: we have investigated mining and staking, and that’s where our Passive Income for 2018 will take us.

Genesis Mining will be where re reinvest in this category, and we’ll also invest in coins where there’s passive interest that pays – like HTMLCoin, for instance – and also check out inexpensive mining for coins like BURST.

There’s one more bucket, but what do we call it and what do we use it for?

Take A Flier, Please

We were able to confirm on Investopedia that we’re using the term correctly, so we’re calling this category “Fliers.” This includes:

Coins that we invested in, lost interest in, but didn’t totally get rid of (LBRY is one)
ICOs or other projects that are either thinly traded or haven’t fully launched (Exscudo, POW)
Airdrops (we’re still finding coins that we were granted that…maybe might be good projects eventually)
“Others” – serving as a catch-all term for anything else that doesn’t fit neatly into a category.

We now have four different buckets – so it’s time to figure out the right allocation for each.

Here It Is: Our 2018 Crypto Investment Plan

Let us explain what’s going on here. We decided to allocate in more of a “barbell strategy” – heavily weighted toward core coins on one side (40% BRED) and toward alts on the other (the 40% Alts category). The “Target” column is the amount we want to see our allocations get to – but, as you can see in the “3-Jan” column, in some respects we have a ways to go.

Coins that we specifically hope to make up ground with we’ve highlighted in pink: we will add where we can, either through profits on something like Bitconnect, or, if we end up with an extreme winner, taking some profits from that coin or token.

Right now, we need to reweight a little away from Alts (59%) and toward BRED (22%); we also know that the Fliers are not an exact science, since some of those airdrops aren’t worth much – but could be worth a ton someday – and others don’t hit the market for a bit, so pricing guesstimations are just that. (In those cases, by the way, we have simply used the value of the investments we’ve made as the value of the coin right now. Exscudo, for instance, claimed to sell at an equivalent of $2, so we calculated the BTC price and offset that for any re-distribution of tokens that occurred later.)

Why They’re “Goals”

We agreed to put this on paper, but we also didn’t want to upset the apple cart. That’s why we’re calling them goals: we aim to get our overall crypto portfolio as close to the weighting as we can by February 1.

But we also give ourselves the leeway to make changes as we see fit. For instance, TRX cannot possibly sustain its run, can it? XRP can’t have anywhere near the run it had last year, could it? And so on, and so forth: while we don’t think we’ll deviate from BRED, we might make a change or two to the Alt portion of the portfolio.

And we can’t be held to a strict “40-40-10-10” formula. (If, in theory, we did that in 2017 with BRED but decided to reallocate each quarter, who’s to say what that would have done to our approach?)

Our Suggestion For You…

Again, this is not individual advice, and seek the counsel of those wise folks in your spheres of influence.

However, this has been a great exercise for us, the act of getting things on paper. We’ve questioned a couple of our own assumptions, and we’ve also had to ask ourselves just how much risk we want to shoulder.

In this vein, we think we’re prepared for 2018, come what may.

We’d love to hear your thoughts.

Dec 04 2017

Four For the HODL File

There’s a rather interesting debate going on in the crypto universe: whether or not “HODL,” the verb attached to the acronym for “Hold on for Dear Life,” should be pronounced like it sounds.

In one corner: boy, does it flow off the tongue as “Hoe-dil.” “I’m HODLing that bad boy, Bob.”

In the other corner, a very Pwn-like or Brett Favre-like desire to say “HOLD” when talking about “HODLing.”

We’ll let y’all argue about which makes the most sense; we’ll just weigh in with four coins you can potentially add to your HODL File.

Siacoin – $SC – Is It Back?

Our romance with Siacoin has been fraught with craziness. Is it going to upend Dropbox as the way everyone uploads files? Is it going to really use everyone’s excess computing strength in a way that the masses can understand?

Oh and, for the #HOLDers, is it going to get anywhere near its four-digit-Satoshi heights of earlier this year?

We’ll admit to being so lovestruck with this coin that we waited til the last possible minute to sell out all of our HODLings earlier this year, and we didn’t get back in until this weekend.

We saw support at 75 Sats and said “it’s time.” It inched up into the 100 level, pulled back to the high 90s, and we’re now along for the ride. Again. This time for good. Until we feel jilted at the altar of 10x again and decide to exit.

Crypto romance is like that.

Cardano – $ADA – Where Did THIS Come From?

We’ll admit to having been whipsawed by this one, which emerged in early October, hung around in the 300 to 600 Satoshi range, and then went like a rocket ship into the 1200s.

And, call us crazy, that’s where we bought in: again, seeing support, lots of trading, and a great-looking project, this one looked like it had 10x potential.

“Ethereum on steroids” is one way to look at its potential; more than just a slick-looking, high-market cap project is the hope. Take a look at the chart here and, as always, DYOR. (“Do Your Own Research.”)

Einsteinium – $EMC2 – Fork Coming

This could actually be less of a HODL opportunity for us, depending upon how this “fork” actually, uh, forks. But to take 55 million coins and burn them, with a current supply of 211 million, might actually bode well for the long-term prognosis. The fork date, as of this writing, is December 9.

Add that to the really cool “Wormhole” incentive – details about that here – and miners might find this one to be profitable, too.

We bought in at 7500 or so – after seeing it pop a little and thinking that it still has a ways to go. Potential for a run is pretty good – and potential for a drop to zero is also something that, well, is always a possibility. Tread lightly. Good luck.

COSS – $COSS – Singapore is Strategically Located

Our thinking here – and a reason that, despite the fact that we are still HODLing despite being down 80% from our initial stake – is that COSS is in the right place at the right time.

Singapore is a great spot for a trading platform; and, if there’s any noise in China – like banning ICOs again, or closing down exchanges – the money is likely to move somewhere else in the region quickly.

So we’re long. Real long. Like “we’ll buy more at these levels (700 Sats) and wait this one out, even if it takes us into 2019.

Final Warnings

We’ve been wrong before. We’ll be wrong again.

So we need to repeat: Do Your Own Research. We’re not responsible for successes or failures as a result of your use of this site. Don’t invest more than you can afford to lose. Check several sources. Don’t give in to FOMO or FUD or any of that other stuff.

Good luck.