I wanted to pass along a good note from Teeka Tiwari. Teeka is very bullish on cryptos and he has a great mentality about it.
By Teeka Tiwari, editor, The Palm Beach Letter
I wanted to send our readers a quick update about the overall volatility in cryptocurrency markets.
Over the past few weeks, we’ve seen bitcoin hit a high of $3,000 then drop to a low of $2,200.
Other cryptocurrencies have experienced similar wild moves.
For those of you who are new to cryptos, this type of volatility may be unsettling.
But for those of you who have been following me since early last year, you know this is par for the course:
• One of the first cryptocurrency picks in our portfolio went from $12 to $20 to $5 before rocketing to $60.
• Another went from $8 to $21 to $6! A year later, it rose to over $400.
• And a third we recommended went straight down! We were down double digits for months. Today, we are up over 500%.
The point is: These assets are volatile—just like the dot-com stocks were in the 1990s.
During that period, the stock rose from a split-adjusted 10 cents per share to over $50. From valley to peak, every $1,000 investment in Microsoft turned into $500,000.
It’s tough to see how volatile Microsoft was on the long-term chart.
My point is that cryptos are following the same script that dot-coms did in the ’90s.
Just like then, we will see explosive growth followed by terrifying pullbacks. But there’s no reason to be alarmed or take drastic action.
There is a three-stage process for thriving during a crazy roller coaster ride like this cryptocurrency bull market…
• Stage 1 is to hold fast to our positions during the pullbacks.
• Stage 2 is to buy in on the pullbacks.
• Stage 3 is to sell your positions when the whole world is crypto crazy.
Right now, we are in Stage 2. That means you should be buying, not selling.
Stage 3 is many years away. When my cab driver and waiter start giving me crypto tips, that’ll be our signal to get out.
Until then, keep this essay handy. Refer to it when you get worried. Remember the three stages. And ask yourself: Have we hit Stage 3 yet? If the answer is no, then just hang tough and ride out the volatility.
Because if you do, we’ll have a whole portfolio of Microsoft-type winners.
Friends, the future is bright for cryptos. Stay focused on the big picture. Use appropriate position sizing, and we will continue to make a killing for years to come.
