Strategize before investing



The U.S. stock market and the cryptocurrency market are being shook in the wake of the Coronavirus pandemic, but that doesn't mean you need to be sedentary with your money.


In less than two months the Dow Jones Industrial Average (DJI) has dropped by 38% and could continue to drop. The crypto market also had its most extreme sell off since 2013 and the total market cap fell by 53%.


Both the stock and crypto market have had sharp bounce backs of at least 22%, but many are asking if the market has truly bottomed out, or are these dead-cat bounces. Is now a good time to invest?


Investing in the stock market


Monthly chart of DJI. Source: TradingView

There is never a bad time to invest in the stock market. Anyone could have invested immediately before the three biggest stock loss periods in the past thirty-five years and their portfolio would be in the green today. The bullet points below show the percent gain someone would have in their portfolio today if they would have invested before every big market drop and never pulled their money out:


  • 1987-present: +713%

  • 2001-present: +89%

  • 2008-present:+57%


To put those percentages into dollars to better understand the value of the percentage, you can use an investment of $10,000 for each one of those time periods and see the value of the portfolio today:


  • $10,000 investment 1987-present: $81,300 (+713%)

  • $10,000 investment 2001-present: $18,900 (+89%)

  • $10,000 investment 2008-present:$15,700 (+57%)


The U.S. stock market has a track record of long-term growth. A long-term investing strategy has proven to be successful. It requires patience and optimism, but if you can weather the market storms then you're in for exponential growth.


Not sure where to get started for long-term investing? Start by checking out Vanguard. Vanguard has a plethora of mutual funds and ETF's with low fees and long-term success.


Investing in Cryptocurrencies




"Be fearful when others are greedy. Be greedy when others are fearful."


Warren Buffets words are ringing in the ears of many financial movers as the prices of cryptos plunge. Cryptos are emerging digital currencies that are alternatives to worldwide fiat currency. The crypto market is a new global financial marketplace to invest in. It doesn't have as long of a track record as the U.S. stock market, but that doesn't mean its not a great place to put your money. Most famously, Bitcoin (BTC) reached a value of near $20,000 per coin in December 2017 and is now trading at $6,450, which is a 210% decrease in 2 years. The crypto market is considered to be in a bear market, but bear markets are proven to optimize financial growth and investment.


Long-term investing


Monthly BTC trading chart. Source: TradingView

Martti Malmi, a Finish developer that supposedly helped create BTC, sold the first BTC in 2009 for $0.0009. That gives BTC an increase of +716 million percent in eleven years. Of course BTC had no clout in 2009, but it was popular by November of 2014 when it saw its price surge above $1,000 for the first time to $1,105. Three years later in 2017 the price went above $2,000. Below is the percentage gains your portfolio would have today if you'd have invested in BTC in the three respective years:


  • 2009-present: 716 million percent

  • Nov 2013-present: +483%

  • May 2017-present: +138%


To put those percentages into dollars to better understand the value of the percentage, you can use an investment of $10,000 for each one of those time periods and see the value of the portfolio today:


  • $10,000 investment 2009-present: Not possible because there weren't enough BTC to buy for $10,000

  • $10,000 investment Nov 2013-present: $68,324 (+483%)

  • $10,000 investment May 2017-present: $33,826 (+138%)


Since its conception in 2009, BTC continues to grow. Many financial movers talk the crypto market down because of the bear market it is currently in, but forget to take into consideration that coins such as BTC are up +138% in the past two years. The U.S. stock market has had incredible growth at +57%, but in twelve years.


Cryptos may be in a bear market, but every coin on the market entered at a near zero price point. It is important to do research on any coin before investing, but many coins are proving that using a long-term investing strategy can be just as profitable, or more, than in the stock market.


Not sure where to get started for long-term investing? Start by checking out Bitstamp. Bitstamp has 24/7 reliable support, proven security since 2011, and five of todays most popular cryptos to invest in.





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DISCLAIMER: This site article does not contain financial advice. Any and all market analysis is solely the authors opinion.