5 ms·

Unless of course they invested when bitcoin was over $1000. Ever heard the phrase "past performance is not an guarantee of future returns?"

by boucher 12y ago

maaku 12y ago
Gold is the typical store of value asset, and the story there is very similar.
- marincounty 12y ago
  Gold has experienced rapid growth since 2008, but historically the growth curve has been flat. I have never heard a competent Financial Advisor recommend gold. But this boom is weird? I wonder if HFT's will be to blame, when we have the crash?
  - bduerst 12y ago
    Gold is a good asset to hedge with, because it is typically inversely correlated with the markets. Hence the boom around 2009. A competent Financial Advisor would calculate correlations between Gold price performance and your portfolio, and use the coefficient to recommend the right amount of gold to buy. Or they just spare you the jargon and do it for you.
  - baddox 12y ago
    How do you define the competence of a financial adviser?
sassypants 12y ago
I've been meaning to build a chart to evaluate this. The question would be: What are the longest periods of time one could have held Bitcoin and lost money? And secondarily, how frequent were the opportunities to have lost money? My ballpark guess would be that the longest you might have held Bitcoin at a loss were if you purchased during a few day span during the peak of 2011. You would have had to have held for almost two years to have turned a profit. But on 95-99% of days in which you could have purchased bitcoin, you would have profited within 1 year. I'll try and put that together. Should be interesting.
- bottled_poe 12y ago
  If I understand you correctly, your estimate is way off. Have a look at the bitstamp exchange rate for the last 8 months. Looks like around 40% of days closed at a price above the current price.
  - sassypants 12y ago
    In my example I was using a 1 year horizon. So none of those closing prices would be charted until they had a year to mature. I think I would need to make a slider so that you could explore the concept at various time horizons -- 8 months might bring a 50% occurrence of profit. But my expectation is that at 1 year 95% of investments are sound, while at 2 years it would be 100%.

Unless of course they invested when bitcoin was over $1000. Ever heard the phrase "past performance is not an guarantee of future returns?"

by boucher 12y ago

Unless of course they invested when bitcoin was over $1000. Ever heard the phrase "past performance is not an guarantee of future returns?"

maaku 12y ago

Gold is the typical store of value asset, and the story there is very similar.

marincounty 12y ago
Gold has experienced rapid growth since 2008, but historically the growth curve has been flat. I have never heard a competent Financial Advisor recommend gold. But this boom is weird? I wonder if HFT's will be to blame, when we have the crash?
- bduerst 12y ago
  Gold is a good asset to hedge with, because it is typically inversely correlated with the markets. Hence the boom around 2009. A competent Financial Advisor would calculate correlations between Gold price performance and your portfolio, and use the coefficient to recommend the right amount of gold to buy. Or they just spare you the jargon and do it for you.
- baddox 12y ago
  How do you define the competence of a financial adviser?

sassypants 12y ago

I've been meaning to build a chart to evaluate this. The question would be: What are the longest periods of time one could have held Bitcoin and lost money? And secondarily, how frequent were the opportunities to have lost money? My ballpark guess would be that the longest you might have held Bitcoin at a loss were if you purchased during a few day span during the peak of 2011. You would have had to have held for almost two years to have turned a profit. But on 95-99% of days in which you could have purchased bitcoin, you would have profited within 1 year. I'll try and put that together. Should be interesting.

bottled_poe 12y ago
If I understand you correctly, your estimate is way off. Have a look at the bitstamp exchange rate for the last 8 months. Looks like around 40% of days closed at a price above the current price.
- sassypants 12y ago
  In my example I was using a 1 year horizon. So none of those closing prices would be charted until they had a year to mature. I think I would need to make a slider so that you could explore the concept at various time horizons -- 8 months might bring a 50% occurrence of profit. But my expectation is that at 1 year 95% of investments are sound, while at 2 years it would be 100%.