Diversification or going all-in in an asset class

in LeoFinance4 months ago


there was an interesting discussion yesterday on the leofinance.iodiscord server. about a comparison between two different asset classes, gold and bitcoin and how one, will make the other obsolete.

Well, for me both are different as BTC is a pure value storage as it is not very useful for trading,
something like the 1000$ bills from the past. If you would find one, it would be much more worth than the nominal value and it is better to store it as to use it as a tender. Yes, BTC can be like gold a value storage. We will reach somewhere in the distant future a price where BTC will be stable, of course at a very high value due to scarcity. It will not replace gold, as gold is also a widely used metal in the industry and is a different asset class. Yes it stores also value but they will not knock each other out as value storage means as each one has it advantage and disadvantage and with the right diversification it can cover the other in different terms.

What is my point in here? I just want to highlight that there are different means and roads to come to the same result.

I'm not a maximalist in any case and I like to diversify in different assets. My favorite assets are and will remain the ones that produce a cashflow. I would rather like to have 7 income streams, than putting my money into gold or BTC. I might be stupid with my analysis, but I like more LEO,Hive,ADA and some others than BTC. Why? Because the first are producing money and BTC stores it. Yes, BTC brings the value increase as an argument, true, but at the moment it does not produce anything.

Money that is not used, has no value. The next example is maybe way off, but this is to underline value and where it is coming from. Pablo Escobar used at a certain point in his life over 2 million USD to make his family warm. Those 2 million USD, an amount that can change a lot of lives, was used to heat a family for a night. What was the value?

Like said, I like to diversify. Of course I love crypto and a lot of my asset value is in crypto, there is no discussion about it.

I have shares in some good, constant growing and constant paying companies. Besides this I love real-estate. This is the trickiest of my asset class,as it can build wealth with leverage, but it can also ruin you very fast, if you don't pick the right one.

I do invest also in people. It might sound strange, but I think fostering relationships or being a mentor can have a pretty good return in life and for me was the best till now.

How do you see it? Do you pick different investment classes or go all in a single one?

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@alexvan, In my opinion one is Physical and one is Virtual. It's my personal view, Bitcoin will never succeed to take the place of Gold. Stay blessed.

Thank you for your comment @chireerocks, yes they are different. BTC as virtual asset has the advantage that can be moved easily allover the world. Try moving 100k in gold over a country border,but on the other hand, I can't use BTC where there is no internet and electricity. :)

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@alexvan, Both have Situational Benefits, but when it comes to the Gold specifically in my opinion Historical, Spiritual and Extraterrestrial aspects and stories are associated with it and it's considered as actual wealth on this Planet.

Cool, I will have a look

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I am a fan of diversification as well. As much as I am a fan of cryptocurrency and the potential it has, I also have a large number of traditional investments. Those were established before I got into crypto, so it just makes sense to keep building on them. Eventually I would like my crypto investments to rival my traditional ones. I wish I had put more into BTC than spreading myself so thin with alts right now though.

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Eventually I would like my crypto investments to rival my traditional ones. I wish I had put more into BTC than spreading myself so thin with alts right now though.

I hope also that the assets will compete, in growth of course. We will see what the future might bring. It will be brighter for sure, just stay on track and have fun. Don't worry about missed chances.

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