Some musing on the Barbell Strategy in my crypto thesis

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I recently learned about the barbell investment strategy, which suggests investing in the two extremes of high-risk and no-risk assets while avoiding middle-of-the-road choices.


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As someone interested in crypto investments, I realized that I had been using this strategy intuitively in my portfolio, with most of my assets on the safe side and a small allocation to risky crypto investments like Hive.

In this blog post, I'll explain how the barbell strategy works and how it can be applied to my crypto thesis.

What Is the Barbell Strategy?
The barbell strategy is an investment concept that suggests that the best way to strike a balance between reward and risk is to invest in the two extremes of high-risk and no-risk assets while avoiding middle-of-the-road choices.

All investing strategies involve seeking the best return on investment that is possible given the degree of risk that the investor can tolerate. Investors who follow the barbell strategy insist that the way to achieve that is to go to extremes.

Source: https://www.investopedia.com/articles/investing/013114/barbell-investment-strategy.asp

The barbell investment strategy can help investors balance risk and reward by allocating a portion of their portfolio to high-risk, high-potential investments while keeping the majority of their assets in low-risk, stable investments. This approach allows investors to potentially benefit from the high returns of risky assets while minimizing the risk of losing everything.

In my case, I have a significant portion of my assets on the safe side of the spectrum, such as property, cash savings, and bonds. These assets provide stability and security in case my riskier investments fail. On the other end of the spectrum, I have a small allocation to crypto investments, particularly in the Hive ecosystem. Hive represents a high-risk, high-reward investment with the potential for significant returns if it succeeds.

The barbell strategy has helped me gain clarity about my investment portfolio and how much commitment I should have on Hive. I can focus on managing my stake in Hive while keeping a balanced distribution of assets to avoid getting carried away. If Hive fails, I am not risking everything, but if it succeeds, it could potentially be generational wealth.

The barbell investment strategy can be a useful approach to balancing risk and reward in an investment portfolio. By allocating a portion of assets to high-risk, high-reward investments while keeping the majority in low-risk, stable investments, investors can potentially benefit from the potential upside of risky investments while minimizing the risk of losing everything.

In my case, applying the barbell strategy to my crypto investments has helped me gain clarity about my investment thesis and how to manage my portfolio.

Do you barbell too??

P/S: This is not financial advice, and please do your own due diligence before investing.

If you read this far... and if you are a like-minded Hiver who is on the path to learning more about Hive and crypto investing, and if you like to be tagged when I write such posts, I welcome you to leave a comment below and let me know. We can form an alliance to support each other's growth.

You might be interested in this post, @thatkidsblack, @graciousvic, @deflacion, @jacoalberts, @young-kedar, @svanbo, @sumotori, @zakludick, @poplar-22 and @hankanon!

What is Hive?

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17 comments
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I wouldn't say that I really do the barbell strategy that much but I guess I do have some invested into the safer stocks such as utilities. In a way, I guess my approach towards risk is the same as it tends to be a small amount into crypto.

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I like this concept, but how hive is the risky investment ?

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Its good and I am agree with you every guy should invest in crypto as much as he can take risk and major invest shoub be in gold, property, silver and many other physical assets.

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I do not barbell but with the market down so low, not saying it hasn't been lower, I put everything into assets that appear to be undervalued. I convert all HBD rewards and am growing my on chain assets.
ALIVEM is my biggest investment, where I own just under 10% of all ALIVEM that are staked. At the current price of just over .053 per ALIVE, and many miners already bought with mining profits, I figure to be free rolling on my !ALIVE earning in about 2 years. Add in the increasing value of ALIVEM and AWESOME token earnings on top of that my feeling it is the best valued community on Hive.
At this current level I am staking all earnings and above .06 I sell and buy more miners. Time will tell if this is a profitable strategy.
If and when HIVE reaches $1.50 I will convert 5% of my Hive to HBD at each $0.50 increase in value. Then remove from the 20% interest earnings from savings as price drops significantly.

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That's a reasonable plan. Thanks for showing us ALIVEM. !PIZZA

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(Edited)

PIZZA!

$PIZZA slices delivered:
cryptothesis tipped svanbo (x1)
svanbo tipped cryptothesis (x1)
@cryptothesis(3/15) tipped @technicalside (x1)
cryptothesis tipped hankanon (x1)
cryptothesis tipped michaelklinejr (x1)

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Ive a question... Where do you share your threads? And what exactly is it all about?

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This is where one can share threads: https://alpha.leofinance.io/threads

For example, I just created one here: https://alpha.leofinance.io/threads/view/cryptothesis/re-leothreads-5ehr7nvd

To my understanding, threads are created essentially through comments to a regularly created post by the leothreads account: https://peakd.com/hive-167922/@leothreads/leothread-2023-03-30-08-40. With that, the automatic upvotes will not be triggered, which is important as it is meant to be a place for shit posting! :) Great for interacting with others about anything.

Anyway, if you look at https://peakd.com/@cryptothesis/re-leothreads-5ehr7nvd, you can see the same thread that I made. However, it is recommended that we use threads directly from the leofinance site so that we can enjoy more features. You can see that it has the look and feel of Twitter.

Try it!

!PIZZA

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If you consider Hive as a "high risk" investment than I believe it's just common sense to act like this... I was actually considering Hive as "medium risk" and would even allocate a small part of my portfolio to "higher risk" investments. Till now this has not been a good idea, since I've only been loosing money on it. That brings me to what I've started to tell... Now not going any more for these high risk investments any more, but allocating a small part of my portfolio to what I call "medium risk", like Hive and low risk trading bots on trustworthy platforms like 3Commas and Binance. This strategy recently brings me some money... !PIZZA

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Wow! Big congratulations to you. Indeed Hive has been medium in risk, relative to some other altcoins.

I should look at 3Commas and Binance again.

!PIZZA

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Now that I'm getting the hang of it, I think I can even improve my 3Commas strategy.
I also would like to check on Grid Bot.
And I believe that Binance is so big because it keeps on developping and improving. Need to look into that one too!.... !HUG

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