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Percentage of portfolio in crypto?

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  • 15-02-2022 10:51pm
    #1
    Registered Users Posts: 34


    Hey, all, I am a fairly new investor and would like to add crypto to my portfolio. What percentage of your overall investment portfolio is crypto? I want a little bit of risk because luckily I am getting into this fairly young.(I am 32) If I plan to have 20 different stocks in my portfolio, should I add 5 cryptos to that? Then I would be 80% stocks and 20% crypto. Would love to hear what others are doing that works for you. Thanks in advance.



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Comments

  • Registered Users Posts: 2,555 ✭✭✭Irish_rat


    All in one crypto project if you're under 10k capital.

    If you want slow and safe returns btc/eth

    If you want higher risk you need to do some research.

    Mine right now is only 5% but I want to increase that to much higher position



  • Registered Users Posts: 34 KrazyKMM


    Thanks for your input. I really appreciate it.



  • Registered Users Posts: 1,455 ✭✭✭FastFullBack


    I really only started properly investing in crypto since November. (25% down right now 🙄)

    My crypto is worth 2.5% of my total net worth right now. Hoping to get that to between 5-10% by the end of the year.



  • Registered Users Posts: 2 ThomasFo


    Up to 50% of the portfolio is cryptocurrency, especially in some countries is not taxed. Newcomers who are not good at using analytical tools sit in front of their computers all day long trying to make money on the volatility of digital currencies. Such business takes a lot of efforts and nerves and does not always bring a positive result. At the same time, the trading strategy can be so simple that it can be automated by writing a special bot-program for cryptocurrency exchanges. The need for constant monitoring by the trader at least to avoid scammers so well reviewed at scammerwatch. This is an important disadvantage that crosses out almost all of the advantages. The fact is that the bot cannot be left to work on its own. If it is based on an oscillator, then it should be used during horizontal ranges. If the bot is written on the basis of trend indicators, it is better to use it when there is a clear trend in the market.



  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    A high risk portfolio is one that has more that 6% - 7% in total in commodities, precious metals, property and other speculative securities. With 20 stocks you will be unable to replicate the performance of any major index over a thirty year period, which is what you are looking at. So you are a long way from low risk. If you want low risk, with a high probability of a reasonable return over the long haul then you’d be better off sticking to dollar cost averaging on indexes and concentrate on asset allocation. That is the low risk benchmark and how much you stray from that depends on how much risk you want to take on.



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  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    When one confuses investing with trading and fails to appreciate the nature of risk, one can produce a lot of drivel.



  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    You don’t invest in currencies you speculate - a currency has no intrinsic value and a crypto currency is even further away as it is not a facilitator of commerce. Regardless of the instrument, some will do extremely well due to a high degree of timing and luck, some will loose their shirt trying to get on the next wave and the majority will most likely come out a little ahead of the game. Where you end up is determined by your understanding of financial risk.



  • Registered Users Posts: 533 ✭✭✭dirk_dangler


    You are hung up on the currency part.

    Forget about that part of the name, (a rookie mistake) and look at the potential utility of the crypto, what use has it now and what is it trying to do in the future, that’s where the money will be made.

    Link is everywhere and that should be simple to DYOR on and Rose requires a little bit more work to understand, but it’s all there for you to see with a little bit of research, think Chinas WeChat app and that’s a potential use of Rose in the west with Meta, plenty more as well.

    The starting point for all research should be who are the early investors in the project, these hedge funds are in the business of making money, so just follow them and you won’t go to far wrong.

    Crypto is a one in a life time opportunity to turn €1000 in €1 million if you get in early on the right project , that’s not happening with the traditional stock market.



  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    Let me spell this out:

    • You are speculating in a currency who's entire value is based on perception and while there is not doubt that the some of the underlying technology has value (indeed I have used and implemented it myself), you are not investing in the technology. Value based on perception combined with a sophisticate underlying technology means that should speculators loose confidence in a particular currency it will adjust faster than anything you have ever seen. It only takes someone like the BIC, Fed, ECB etc.... to instruct banks to stop allowing the conversion of a currency and it will be gone in a matters of hours. The people invested in the technology and using the technology will still be there and will still continue, but those who simple held that currency will be wiped out. Now that is a rookie mistake as you call it.
    • As for the hedge funds, part of my services was to provide them with performance and attribution information, so I have a pretty good handle on their internal working. Hedge funds regularly have to be reconstituted, closed out, frozen etc because they loose the clients too much money. On top of this you have no access to the reasoning being any strategic position a fund is taking nor what other strategy is being played against it at the time. So ya, good luck in your expectations of replicating their results.
    • Over the past thirty years I have been involved as the picks and shovels guy in everything in trading weather futures, debt securitisation and even the recover of the disaster that was LTCM. The difference this time, just like every other time, a different set of guy thinking this time it is different.... it's not.
    • You spend a lot of time talking about the capability of the technology, while mistakenly believing by speculating in a currency that you are investing in it.....

    At the end of the day it is your money and apart from those that might have to depend on you, it is you that will deal with the out come be it good or bad.

    I hope it is good for you.



  • Registered Users Posts: 34 KrazyKMM


    Great idea trying to work up to that. Right now is a good time to buy in, but I don't want to put a lot in all at once.



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  • Registered Users Posts: 34 KrazyKMM


    I definitely don't want to actively trade it. I would be a long term holder so more of an investor than a trader and would do 5 tops. Would like to find at least 1-2 solid choices.



  • Registered Users Posts: 34 KrazyKMM


    Thanks so much. I appreciate the input. I have been buying some VOO lately since it is a good time to buy it. I feel like having the solid base with the ETFs is a good way to start. Then once I get into a full position there, I will continue to DCA into it, but start positions in other stocks. I would do the majority in value stocks, but eventually I do want to add the crypto and will do a couple of growth stocks, too.



  • Registered Users Posts: 34 KrazyKMM


    I responded to that one before I saw you posted this. I definitely do NOT plan to day trade. I am willing to manage my portfolio, but I do not have the time nor patience to watch the ups and downs like that. More power to anyone who can. I want to do bullish positions.



  • Registered Users Posts: 34 KrazyKMM


    What are your thoughts on Bitcoin and Ethereum? Do you see any utility in either of them?



  • Registered Users Posts: 34 KrazyKMM


    I get what you are trying to say, and I agree. I asked Jim this...do you see a lot of utility for the future in Bitcoin and Ethereum? I have been doing quite a bit of research on them. I am leaning toward an investment into Ethereum due to its utility and involvement in the future metaverse. Also going to proof of stake. I only wish that I was able to start positions in multiple things at once. The prices right now are great. Also, you mentioned Hedge funds getting into crypto. Is there a good one to watch? I will not go in blindly. I want to gather resources and facts from multiple sources, but also like to hear about opinions, too.



  • Registered Users Posts: 34 KrazyKMM


    Thanks for sharing your thoughts. What do you do for a living, Jim? Also, what do you think about the government putting regulations on crypto and the fact that it is taxed? It is subject to capital gains rates just as stocks are. I feel like the United States government might think of this as a cash cow for themselves, and if they put regulations on it, then that is their way of controlling it but also making money off the taxes. In doing so, they are "acknowledging" the crypto as currency in my mind. Would love to hear your thoughts on that. Thanks.



  • Registered Users Posts: 19,918 ✭✭✭✭cnocbui


    I'd say 15-20% BTC/ETH

    My initial BTC investment was 1.25% of the total and it now comprises 28% due to 2,355% appreciation.



  • Registered Users Posts: 26,216 ✭✭✭✭Peregrinus


    Making something subject to CGT does not acknowledge that it is currency; just that it is an asset - i.e. something which can be bought and sold. Most CGT applies to transactions in assets that are not currencies.



  • Registered Users Posts: 533 ✭✭✭dirk_dangler


    You are still hung up on the cryptocurrency part, The tech is blockchain, the most famous is BTC, a cryptocurrency.

    The name cryptocurrency has gained acceptance but the reality is it’s blockchain.

    Now think of blockchain as the internet and we have seen Google, Facebook and so on becoming huge building on the internet, so now we see similar building on Blockchain, so forget about the crypto currency aspect and look at the utility of the projects being built.

    The same people who built the internet in the USA and China are pumping big money into blockchain projects, there is no rivalry between these 2 countries they are working together , the same investors are building it in both countries, see early investors in Google, Facebook and Baidu, Tencent they are the same people, so if you can look at the bigger picture and pick the future blockchain winners you can make big money, forget the currency part and look at the utility, that’s where the money is.

    Two early investors in the internet are now investing in blockchain, these 2 are total insiders connected to the highest levels of government, so don’t worry about a government ban, it’s not going to happen. DYOR. It’s all out there if you look for it.


    Post edited by dirk_dangler on


  • Registered Users Posts: 2 ThomasFo


    Any success stories to share?



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  • Registered Users Posts: 26,216 ✭✭✭✭Peregrinus


    This is a perhaps compelling argument for investing in blockchain technology. But investing in something which relies on blockchain technology, like cryptocurrency, is not remotely the same thing as investing in the technology itself.

    You might as well argue that by buying an ICE car you are investing in the oil industry. You are not. While it's true that your car will be worthless if the oil industry winds up, the converse is not true; your car does not rise in value if the oil industry booms.



  • Registered Users Posts: 533 ✭✭✭dirk_dangler


    Start here, global standards... look at the people and who they are associated with

    Then check out here, the people and who they are and what they are invested in.

    https://en.idgcapital.com/



  • Registered Users Posts: 26,216 ✭✭✭✭Peregrinus


    If you think there's information that should interest me there, tell me the information. I'm not doing your investment research for you.

    Spit it out. Are you saying that the members of the GBBC are heavily invested in cryptocurrencies? And that this shows that investing in cryptocurrencies is the same thing as investing in blockchain technology?



  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    Yep, this guy seems to think consuming the product of the technology is the same as investing in the technology…. Bit like thinking you can invest in the butchers by eating more sausages…..

    mind you with the way war and sanctions are going I would not be surprised if there is a move to regulate crypto to prevent it being used by the Russians to circumvent sanctions or possibly a moratorium on converting by the banks, which could be implemented quicker in fact. We will have to wait and see.



  • Moderators, Business & Finance Moderators Posts: 10,084 Mod ✭✭✭✭Jim2007


    Yet another post about the technology that is not relevant to the discussion. Go back and read the question posed and try to make your posts relevant to the question of asset allocation. At this point there is no point in responding to you.



  • Registered Users Posts: 19,918 ✭✭✭✭cnocbui


    Bitcoin proved to be very useful for Venezuelan refugees that fled their country so it may well also prove to be of similar use for the unfortunate coming Ukrainian diaspora.  It has also been of great use for the unbanked in Africa with family working in Europe using it to send money they earned back to family members in Africa who while not having access or use of bank accounts, had a phone. https://forkast.news/cryptocurrencies-remittance-africa-blockchain-bitcoin-money-transfers-fees/

    https://www.bbc.com/news/business-47553048

    Don't be so keen to throw out the baby with the bathwater. The nature of the blockchain makes bitcoin transactions far more open and visible than fiat via banks usually is. If your banking sector is regulated and KYC compliant, there is no need to get hot under the collar with imagined indignity that crypto is facilitating crime. 99.999% of crime is facilitated by conventional fiat and it's associated systems..



  • Registered Users Posts: 533 ✭✭✭dirk_dangler


    I’m not going to spoon feed you, you want to make money put in the effort, if you can’t be bothered to browse a web site and see what is clearly happening, well that’s on you.



  • Registered Users Posts: 533 ✭✭✭dirk_dangler


    You are clueless.

    Here is a starting point for you to get stuck into.

    When internet was created someone had to then come along and standardised certain aspects of it, HTML I’m sure you know, well we are at the start of blockchain and the standards are being created right now.

    So if you hand any sense you would be looking at who are setting regulations and who then is working to meet these requirements to operate in the US/EU/China, these will then become the global standards, it’s not difficult to understand or is it?



  • Registered Users Posts: 26,216 ✭✭✭✭Peregrinus


    What is difficult to understand is how this in any way suggests that acquiring cryptocurrency would be a wise investment. You've been invited several times to bridge that particular gap in your argument and you have pointedly declined. In the absence of better evidence, I'm of the view that you are unable to do so.



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  • Registered Users Posts: 34 KrazyKMM


    Thank you. Do you continue to dollar cost average into them? How long ago did you start?



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