Re: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion
My term deposit at bank is about to mature after 6 months. I'm getting like $1k for this shitty investment. And what is worse, the interest rates got halved. Next time, I'll be getting like $500 for the same investment at the same bank.
I am making a big decision here:
Option 1: Keep collecting peanuts. Keep DCA'ing.
Option 2: Buy the dip, Keep DCA'ing. (1-2 btc)
Option 3: Nuke everything and become a 1 million club member while I still can. (all in)
*Option 3 violates my investment rules. Violates it like fuck all gimme lambo.
I am making a big decision here:
Option 1: Keep collecting peanuts. Keep DCA'ing.
Option 2: Buy the dip, Keep DCA'ing. (1-2 btc)
Option 3: Nuke everything and become a 1 million club member while I still can. (all in)
*Option 3 violates my investment rules. Violates it like fuck all gimme lambo.
I had done option "3" once in my life when I was much younger. Lost everything in that fiat account, which I since rebuilt to personal ATH, but it took many years.
That said, it depends on several parameters:
1. Your investment portfolio size vs your yearly income
2. Your age
3. How steady you job is (if there is a job).
4. family responsibilities, if any
5. last, but most important-the probability of the trade success (if it could be assigned)
If investment portfolio is small in comparison with yearly income, I don't see why someone cannot invest a large %, providing that the job is steady and you have a good income.
There is a formula (Klein criterion-see wiki) which describes the % of portfolio one should dedicate to a bet.
The problem is-it involves assigning a probability to a trade success, which is almost always an impossible task.
Example: on a trade with 60% success one should invest 20% of the portfolio; trade with 70% success, 40% of portfolio, etc, etc.
Mind you, these %% are "real" numbers, not imaginary ones.
Also, NO MARGIN.
EDIT:
Formula...Fraction of portfolio to invest (in decimals)=[2X(chance of trade success in decimals)]-1
Therefore, 0% to invest when 50:50 (
Everything else-in between.
EDIT2 messed up the last name..it is Kelly, not Klein, kudos to Millionero for correction.