Tuesday, March 2, 2021

Cryptocurrency markets - A catalyst for a financially sound future

With the amount of new faces flooding in to the sub, and broader communities, I thought this post might be useful to those who are new to financial markets.

Some of you may have had your debut in to financial markets due to recent events. Whether that be, Elon Musks tweets regarding dogecoin and bitcoin. Or the latest GME stock short squeeze and robinhood scandal. However you were introduced to the markets it is paramount to invest - Not just in the cryptocurrency markets, but the broader financial markets too - infact I'd argue moreso.

Cryptocurrency markets can be very exciting, especially in an over exuberant bull market like we find outselves in now. Cryptocurrency tokens can move in a single day what the S&P 500 or FTSE 100 moves in a whole year.

To the ignorant, this can seem like a no-brainer. Why invest in stocks, when a single token can 10x in just one year?

If you find yourself asking this, I suggest you do your own research, and never just listen to one opinion, especially on the internet.

But as I'm sure you know by now, this space is extremely volatile and unregulated. Your favourite coin today, may just be a footnote in history in the next bull run. On the contrary, it may catapult your returns straight to the moon.

We're here because (Hopefully) we believe in the technology and the movement. Make no mistake, cryptocurrency is the future however, the stockmarket is still a time proven way to make your money work for you. Low cost index funds can be one of the best ways to take advantage of compounding interest.*

On the subject of taking advantage, make sure to also fully utilise government tax efficient schemes like your pension, 401k, ISA or whatever your country's equivalent may be.

*If you are yet to discover the wonder of compound interest I urge you to do your own research.

Tl;dr - Use cryptocurrency as an introduction and addition to a healthy and diversified portfolio. Invest in traditional markets like stocks, bonds and of course encompassing securities like low cost index funds. Make sure you have a sufficient pension and fill your tax efficient schemes as much as you reasonably can.

Caveat - This, as usual is not financial advice. Purely my (Hopefully grounded) opinion which is intended to make you think about other markets and investments.


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