Narrative base or Fundamental Base Investment. Which one is better.
- Narrative Investment
- Fundamental Value based Investment
source
Narrative investment is one of the easy way of investment. You don't need to do you own research. All you need to do is invest on an asset which has hype in market. Majority of the new investors who have no knowledge and skill love to do investment on the basis of narrative. Narrative investment may give you profit for a short period of time, but it is not a long run solution.
Just imagine investors who invested on Axie Infinity earned huge profit. After seeing the peak Axie is no more place of building money. Infact, people who invested late has suffered a big loss in game. This reveals that narrative investment may earn big reward but it is pretty risky to select narrative investment.
Remember Crypto moves in both way. Hype in the market help to raise the asset worth and when the price come to its real value people easily loss handsome amount.
Narrative investment gives high return as compared to Fundamental value based investment. However risky factor is exponentially high in narrative investment. Another advantage of narrative investment is that it save your time and efforts which make it good for those investors who have little or no time for their own research.
Do your own research is a skill of making good investment. Narrative investment keep you away from your own research. Hype in market may fell any time. Better to invest according to your choice. After all at the end you are responsible for your profit and loss. Self decision will help to build confidence.
Now, comes to the fundamental based investment. This investment based on Fundamental analysis. Fundamental analysis include know how of the team which is working on project, its reputation, and know how of the competitors beside understanding the technical analysis like graph chart and other parameters.
Fundamental based investment increase your skill and it is based on your own research. You can do fundamental analysis by reading the assets white paper and other market news. Fundamental based analysis increase your vision for better understanding of market. Enhancing vision build your confidence as a result it improve your decision making which will help you to make better investment strategy.
Unlike Narrative investment fundamental based investment has lower return and lower risk rate.
I am not fully against the narrative based investment as it offers high reward at the cost of high risk. You can invest small amount in narrative based investment. It is better to have lion share on fundamental analysis based investment. It will prove good for your long term investment. What is your opinion my friends?
This is it for my today post. Wish you all a very happy, healthy and prosperous life ahead. Have a nice time.
Narrative investment is much safer. At least you have the money still to imput into other ventures. The first can make lot more money but can bankrupt you !
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You have renewed my grief by naming Axie Infinity, I still remember what a good year 2021 was for me. But you are right, more risk, more profit, less risk, less profit.
I think narrative based investment is like playing the lottery. Your chances of losing are higher than the chances of winning. I prefer fundamental based investment with steady and consistent growth. It has a higher ROI in the long run than narrative based investment.
I am an investor in Axie infinity and I belive the team behind the project and I'm pretty sure they will find some way to get themselves out of this situation of uncertainty. Both types of investments have their own benefits and losses.
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I myself am an investor of axie infinity game, I also created many accounts and gave it to people to play when I was very good, people were playing, today the price has come down, so people have stopped playing. A lot of damage has also been done. I still have full faith in the team and in the coming bull market we will definitely see this project popularized once. How far do you think their established SLP can go within the upcoming ball market?
I would say do a bit of both because it is our money at the end of the way and having a diversified portfolio and investment helps.
Hover before that DYOR their is no substitute for that.
It is not simple as mathematics, as there is no single formula of success in investment- funny how I've never found mathematics simple ! 🤦
It's certain both narrative-based and fundamental-based investing strategies have their advantages and disadvantages, but I feel the better or most suitable option depends on individual circumstances and preferences.
It is often recommended to have a diversified portfolio that includes a mix of both strategies to balance risk and potential returns.
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