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>so your boring old index fund might go down when crypto goes down I need someone to explain to me how my S&P 500 blackrock ishares are going to die from crypt

>so your boring old index fund might go down when crypto goes down I need someone to explain to me how my S&P 500 blackrock ishares are going to die from crypto. I don't think FAANG, Berkshire, Exxon and Pfitzer are going to notice if all of crypto dropped to zero right now.

rglullis 5y ago
How much of FAANG's customers would cease to exist and stop spending if crypto went to zero?
- blibble 5y ago
  probably less than 1%
  - rglullis 5y ago
    How much of a hit it would be on FAANG's market cap if their revenue went down by 1%?
    - blibble 5y ago
      0
      - rglullis 5y ago
        Right, because stock markets never go down when tech companies show signs of declining revenue.
        blibble 4y ago
        crypto is so insignificant it will be regarded as noise on their PnL
lxgr 5y ago
How is "going down" (by some percentage) the same thing as "dropping to zero"?
- thfuran 5y ago
  If they wouldn't be affected by crypto going down by 100%, why would they be affected by crypto going down by less than that?
netheril96 5y ago
> I don't think FAANG, Berkshire, Exxon and Pfitzer are going to notice if all of crypto dropped to zero right now. If some investors are invested in both FANNG and crypto, when they face margin call in the latter they may have to sell the former to cover their position.
- chii 5y ago
  do most investors really take out margin loans to buy stocks? I can understand _some_ investors do it, but i'd imagine it's not a majority.
  - netheril96 5y ago
    > do most investors really take out margin loans to buy stocks? In the scenario I describe, those investors take margin loans to long or short crypto, and when they fail, they sell other assets to cover themselves. This is just one possibility I describe. > but i'd imagine it's not a majority. No one knows. It may take only one institutional investor who lost a gigantic amount of money in crypto trading and were therefore forced to sell stocks to shake the stock market.
deleted 5y ago
[deleted]
sb057 5y ago
1) There are a number of publicly-traded crypto-centric companies, such as Coinbase, Riot Blockchain, Marathon Digital Holdings, and MicroStrategy. Although not part of any major index, investment firms that are undoubtedly have significant exposure to them. 2) There are plenty of crypto ETFs, such as GBTC and BITO, where selloffs there could cause liquidations elsewhere. 3) Major companies themselves now have significant crypto holdings. The most famous being Tesla, but investment banks have been piling into it over the past year. SPY's own State Street announced a 425-man team to head a new division last June.

rglullis 5y ago

How much of FAANG's customers would cease to exist and stop spending if crypto went to zero?

blibble 5y ago
probably less than 1%
- rglullis 5y ago
  How much of a hit it would be on FAANG's market cap if their revenue went down by 1%?
  - blibble 5y ago
    0
    - rglullis 5y ago
      Right, because stock markets never go down when tech companies show signs of declining revenue.
      - blibble 4y ago
        crypto is so insignificant it will be regarded as noise on their PnL

lxgr 5y ago

How is "going down" (by some percentage) the same thing as "dropping to zero"?

thfuran 5y ago
If they wouldn't be affected by crypto going down by 100%, why would they be affected by crypto going down by less than that?

netheril96 5y ago

> I don't think FAANG, Berkshire, Exxon and Pfitzer are going to notice if all of crypto dropped to zero right now. If some investors are invested in both FANNG and crypto, when they face margin call in the latter they may have to sell the former to cover their position.

chii 5y ago
do most investors really take out margin loans to buy stocks? I can understand _some_ investors do it, but i'd imagine it's not a majority.
- netheril96 5y ago
  > do most investors really take out margin loans to buy stocks? In the scenario I describe, those investors take margin loans to long or short crypto, and when they fail, they sell other assets to cover themselves. This is just one possibility I describe. > but i'd imagine it's not a majority. No one knows. It may take only one institutional investor who lost a gigantic amount of money in crypto trading and were therefore forced to sell stocks to shake the stock market.

deleted 5y ago

[deleted]

sb057 5y ago

1) There are a number of publicly-traded crypto-centric companies, such as Coinbase, Riot Blockchain, Marathon Digital Holdings, and MicroStrategy. Although not part of any major index, investment firms that are undoubtedly have significant exposure to them. 2) There are plenty of crypto ETFs, such as GBTC and BITO, where selloffs there could cause liquidations elsewhere. 3) Major companies themselves now have significant crypto holdings. The most famous being Tesla, but investment banks have been piling into it over the past year. SPY's own State Street announced a 425-man team to head a new division last June.