Hello Tackle Traders! This surely will be a December to remember for quite a few reasons but I think we can all agree that the “B” word has been off the charts and there are people going around using the B word and they have no business doing so. And by that, I mean Bitcoin lol! Everywhere you go it is the number one topic. I was watching an interview on TV and the bitcoin expert was asked to explain the recent rise in bitcoin especially in the last few weeks. I laughed at his response but looking at the chart it rather makes sense. He said that the reason bitcoin has been soaring lately is that during Thanksgiving dinner every household had at least one or two early adopters of bitcoin and they were telling their family and friends all about how much money they’ve made and now those family and friends have joined in causing bitcoin go higher in price. Another said that every time there is a google the price goes up! Lol. It seems like everyone has something to say about Bitcoin so allow me to share my experience and thoughts on the matter too.
Bitcoin and other digital currencies like litecoin and ethereum have been on an unbelievable run and those that invested in these cryptocurrencies love every bit of it myself included. I opened my coin base account in October of 2016 over coffee with a colleague. I had heard of bitcoin prior to that but I just did not have an interest in it because I was still learning about options. That colleague sent me one dollar of Bitcoin to fund my newly installed coin base app and I never bothered to look or even fund the account until June of this year thanks to my friend Jake. Upon opening the app, my dollar was now worth five dollars so you can imagine the number of times I kicked myself for not investing in bitcoin when I initially opened the coin base app months prior. Needless to say, I figured it was never too late so I invested in ethereum initially while waiting for a bitcoin correction.
Well, all bitcoin appeared to do after I vowed it would dip was go up in price so I invested in more ethereum and also threw in a couple hundred dollars in litecoin as well and finally in September I bought some Bitcoin. I got tired of waiting for a correction that clearly was not going to come anytime soon. By the end of October, I owned all three cryptos available through the coin base app. Unlike what I have been reading lately about people mortgaging their homes in order to buy Bitcoin, the amount I invested in these digital currencies, was based on what our coaches and mentors preach repeatedly about position sizing and portfolio design.
Investing in cryptocurrency is a speculation trade and therefore only a small size of the total portfolio is to be allocated to speculation trades. I was comfortable knowing that if there was a bubble in the currency market and bitcoin, ethereum and litecoin all went to zero, I was ok losing the money invested. It is outrageous the lengths people are taking to invest in Bitcoin yet they have no idea the amount of risk involved. Some have also discovered GBTC and are trading that in their retirement accounts and again I caution on position sizing if that’s the direction you choose to go. I have taken profit off my original investment and now I’m playing with house money and even now I am considering taking some of that profit to put in other investments….more on that another blog.
Therefore, for those who think they have missed the boat and going through the shouda, wouda, couda of not getting in early on the cryptos don’t worry, with Bitcoin now being traded on the futures market, it goes to show that cryptos are here to stay. Whether bitcoin will be the digital coin of the future that is still to be determined. So no matter when you decide to join the bandwagon, as the beer ads on TV remind us to drink responsibly, please remember to position size accordingly.
For more on the cryptos make sure to catch this week’s podcast with the Justice Brothers http://tradingjustice.com/episode-246-fundamentals-of-crypto-currencies/
~Emily
Emily Muiruri, an Entrepreneur, Real Estate Agent and Business owner. Born and raised in Nairobi, Kenya before her family moved and settled in Maryland. She began her trading journey in January 2015 after 17 years of Property Management in the Self-Storage Industry. Emily uses different strategies to trades stocks, options and forex. Although still a student learning and enhancing her trading skills, she has strong desire to teach women to take control of their finances and become traders. Writing blogs is one of the ways she’s is looking to spread the word and get more women involved. Emily knows that with the right education and trading system women can be successful traders
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