Topic: Advice for investing bitcoin (Read 3129 times)

Investing in bitcoin is also, on a basic level, about accumulating and holding bitcoin until you decide that it's time to divest.  Therefore, it's important to consider many ways of accumulating bitcoin and that doesn't just mean business ventures.  It means aggressively seeking various bitcoin revenue streams. 

For example, cloud computing can be used to mine various cryptocurrencies which can quickly be liquidated to bitcoin and there are frequently freebies on computing as a service.  Another way might be to sell things on these forums or through other web-based formats that accept bitcoin as payment.  Just be careful with the latter example and be sure to use escrow.

well is math taking control of the mining game,the gold acts like that ... the forex the same way bitcoin is the next to enter on the is world the diference is the bitcoins is decentralized soo there isnt a 10 person,or governments..... holding a huge ammount to control the price otherwise it would happened already the pump and dump of bitcoin....
and the most important is the interest of crypto world should keep raising week by week.. soo in lets say 5 years some more users from internet will find crypto coins... and will meet the bitcoin as altcoins...soo will be like interest vs worthvs up or down

I don't think that bitcoin will raise after that
Why do you say that?
My opinion is when the mining process will reach the end bitcoin will decrease.
As I said, this is just my opinion.

well i believe btc price will go high on the next years why because the mining process will reach an end soo the new coins will stop enter the market soo all coins should raise as the ammount of them will be less and less over the years.

Benjamin Graham= value investing, or buying a company that is valued by the market at less than it is worth.  An example could be something that owns land like a car dealership or factory that bought the land, or even something like walmart.  If investors in general don't factor in the value of land then you can sometimes get the stock at a discount, sometimes at a significant discount.  There is more to it, but that is the basic idea.

Peter Lynch= growth investing.  His approach generally speaking is to buy companies that have lots of room to grow.  So try and find companies like amazon before they get big, that sort of thing.  Generally speaking his strategy is buying small and mid cap companies that have great potential for growth.

They are two different strategies, but the point is to look for good investments whether they are small cap, undervalued, growth stocks, turn around candidates, etc.  FWIW it is pretty hard to find undervalued companies right now.

And yes, those two are "fundamental analysis" guys.  My strategy with stocks is always long term.  Once in a while I will swing trade when I see a good opportunity.  I only use basic technical analysis, and dont put much faith into it.  Its not that it is useless, it is that if you are buying a stock with a long term investment horizon then you don't really need to sweat the current cost too much.  If it is well priced, and the research indicates to me it is a buy, then I am not going to try and time an entry.  I just buy it.  the interesting thing about technical analysis is that whether or not it works, lots and lots of people think that it works.  So when the ema crosses and indicates a buy/sell, lots of people all over the world will act on that indicator, sort of making it a self fulfilling prophecy.

I could day trade, but the thing is I wouldn't really get a better return versus long term trading, and it is a whole lot more work than long term trading.  I prefer to do the work once, sit back, and check on the company every few months to make sure nothing is going south.  Ok so maybe I keep an eye on them every day, but I would like to only check every few months

I don't day trade bitcons/alt coins much, although I am dabbling with very small amounts of money to learn.  And I still don't put much effort into technical analysis.  I don't need to.  You can see the order books (something I don't have access to for stocks) and that alone is powerful.  But for alt coins the market caps are so small, and the volumes so low, that in a few cases I could clear the order book with 3-5 btc.  Not that I would because it would be too risky.  Who cares if the price goes to the moon?  If I have no one to sell to then the point is moot.  In case you are wondering I have lost money so far with trading alts, but the amount is so insignificant that it might as well be paper trading.  This is a great way to learn how to trade, learn from mistakes, and not really expose yourself to risk.  Just use a small amount that you don't mind losing, and if you win even better.

If I said 3% in 7 days that was a typo.  I meant 10 days.  Either way it is a good return.

I did my own research into cloud mining companies.  I have determined that hasnest is legit.  But you are right to not take my word for it, you should do your own research into the matter.  I could very easily be wrong.  But hasnest is owned by Bitmain, and they let you buy hardware and house it in their warehouse.  They don't promise any returns, and the maintenance fee is 50% of the revenue (for the s5).  You can get the s5 you bought shipped to you.  There are other things, but for me everything points toward it being a legit mining site.

The "roi" on hashnest was something like 250 days when I bought in.  However this is a little misleading.  The hash there has an inverse relationship to the price of bitcoins.  So I bought in at btc=~238.  Recently btc went way down to 220 or so.  This means that the bitcoins are less powerful and hash becomes more expensive.  The really cool thing is that the market on hashnest lags the price of bitcoin a bit.  IMO this is because the volume is low and also because they are not listed on exchanges, they run their own exchange.  Anyway I collected interest for ~15 days or so, and when the price of hash shot up (like I knew it would because it lags) I sold my hash at a ~6% profit.  The market there has no transaction fees so you can do fun stuff like trade the gap.  But the really cool thing is that if you are trading the price oscillations, when you are holding hash you get to collect the inome it earns while you hold it.  Then you can sell it any time you want.  You if bitcoin goes up you sell at a "loss", if it goes down you sell at a "profit."  I put these in quotes because the price of hash is related to the price of fiat.  However if you are holding bitcoins and, like me, do not plan to sell them any time soon (or ever) then you don't have to worry about the price of fiat.  This gives me a really interesting way to win when the price of bitcoins goes down.  Anyway I have not been on hashnest for very long, and the trade I mentioned could have been handled better.  However I made ~10% in a pretty short time span.  Its not so easy to make 10% on stocks in less than a month.  Most people consider 10% a year on stocks to be very a very good average to shoot for, so you can maybe understand why I am so excited to do this in 15 days (or so).  Now the interesting thing is that if the price of bitcoin stays low for much longer then I would have been better off not selling my hash but holding it and collecting the interest.  This is a risk I guess, but imo it is all a learning process and I am bound to make mistakes.  I don't worry about optimizing trades because that is impossible: it requires predicting the future.  Rather I focus on not losing my capital investment.  I think this is a much healthier way of looking at things.  So anyway what I mean when I say that the roi is misleading is that you can sell your hash at any time, and because it lags the price of bitcoin there is little chance that you will get wiped out.

And yes I know very well what difficulty is, but historically this tends to change at reasonable rates.  Sure this can cut into returns but I am not worried about that, I am worried about getting wiped out.  Even if they ship the s6/7 soon, and it is 10x better than the s5, it will still take time to ship them, install them, and get them mining.  This will give me time to decide if I want to liquidate or not.  Barring either a massively disrupting mining technology on the order of gpu->asic, or a REAL whale spending billions on a mining center, the difficulty change should be reasonable enough.

There are basically two different types of cloud miners:  duration (x years for a price) and buying has (like hashnest, scrypt.cc, etc).  The thing that makes hashnest so attractive is that I can cash out at any time.  Thus I don't have to wait 250 days or whatever for roi.  I get a % and can take my money out at any time.  Also the hash never expires unless it does not cover mantenence for 10 days in a row.  This is a huge advantage.

some good ways is use exchanges taking new crypto as some know crypto currencies and buy and sel lending now alreaddy focus and more protected with some kind of colateral some exchanges running it already,the main problem is that the money cant go out from the exchange soo in real life not helping too much lolbut is a good option to user skills to make a bit more income

The majority of ppl are fascinated at day trading for the quick profit. But due to lacking experience, most of them are ending up losing a big chunk of money. They are following the crowd and buy at the peak. They are the most busy ppl and getting tired every day. Then suddenly the price plummets. I personally like to do our own research and find the undervalue products (most of people probably dumps them) I will build up my stash. I think BTC price is fluctuating between this limited range for a long time and have a solid support. I think it is a good time to buy a little bit.

Don’t take my advice, don’t take anybodies advice, do your own research and make decisions on that basis ONLY.
A lot of people offering bitcoin investment advice are doing so on a self-serving basis. ie. Don’t buy bitcoins now, because they want to keep the price low, or do buy bitcoins now if they want to pump and dump.
Longterm bitcoins will have one of two outcomes – they will either be extremely successful, in which case the smallest investment in bitcoins could make you extremely rich, or they will be dead in the water and worth nothing.
Finally, only invest what you can afford to lose, in bitcoins. Or more to the point, never invest more than you can afford to lose in bitcoins, because there is a good chance you will lose everything

I googled the persons you mentioned... it sounds like they are some old school stock valuation guys. That doesnt have so much to do with technical analysis right? Though when you say you switched to bitcoin then i would assume you would need to know technical analysis. Do you?

Though what i really wonder about is you claiming success with cloud mining? I did not hear of a cloud mining company that worked out at the end for investors. You know about difficulty rise, right?

All the later cloud mining companies that looked good at first, did not bring the investment back to their investors. So whats the difference at hashnest, why do you think its legit and why do you speak about 3% in 10 days and in the next post 3% in 7 days? Anyway... what you write sounds very much like someone who doesnt know what the difficulty is. Mining means that you have to earn your investment back in the first 2 or 3 months. Otherwise you wont get it back because your returns will be so small that it doesnt add up anymore. Because of diff rising.

Thats why im interested what you will say.

Besides that... good advices, i had to painfully learn too that there are no good chances you have to take fast in order to not lose. You will lose if you act on this.

I base my trading strategy mainly on two sources: Benjamin Graham and Peter Lynch.  There are others but for me these are the giants of investing.  I also adjust to market conditions.  The last few years any stock with a solid balance sheet that paid a good dividend was gold.  I made a ton on Windstream and Altria in the last couple of years for example (sold both).  This will change eventually.  Also I think one of my biggest strengths is patience.  For example I did ok with SWKS, which I bought at 28$ a share originally.  A week or so after I bought it, it began to plunge straight down to ~22 a share.  I looked again at the company and decided that the market was insane and I was not.  I would have bought more if I had the extra money.  I held on to it and now it is over $100 a share and rising.  I had to hold a few years for this but it paid off in the end.  Now there are rumors going around about Qualcomm buying them.  The market is crazy and irrational, and if you pick good companies there are many opportunities to cash in on this.  Be patient, don't pull the trigger until you are sure.  There is a great opportunity every day of the week so don't worry if you miss out on a rally.

If you ask for a stock pick I would beg you to wait for the interest rate increase to see what happens.  Sure you might miss out on some of this historic bull run, but that is a chance I am willing to take.

After spending some time with bitcoin and related markets I am tending to move away from stocks.  Why work my ass off for 20% a year when I can get 3% a week on hashnest?  The returns here are insane, and when I tell people they all insist it must be a scam!  

The one industry I find interesting right now is oil.  The stocks took a hit on oil price decreases and there is a lot of pessimism going around.  For me this is a good sign.  Summer is here and traditionally oil prices go up.  The risk is that prices stay the same or drop further.  But a few bucks could be nice in a large cap oil mutual fund.  I am not going to do this because I am too paranoid about the market as a whole, but if I was going to research stocks today this is where I would start.

Edit:  One last thing I forgot:  I read that up to 80% of market volume is from high frequency traders.  I worry about this too.

Yeah... buying fun that way... though i think im not made for that. I would constantly think about that i cant win against mathematics and that i will lose my money. On top i would think that i have to use my time in a better way in order to get an income stream somewhere...

More good stuff!
@melody82, I have also largely divested my stock positions because I also think the market is overvalued, distorted by QE, and gamed with things like high frequency trading. But even when I was making money in it I rarely got 20% on anything. I should have you pick my stocks, lol. I usually only ended up with 12-15% / year, if that.

And I don't want to disparage gambling. It is a fun activity. Sure it costs some money, but so do many things that never offer the chance of going home with more cash. I only cringe when I see someone asking for a gambling loan so they can "invest" it to win back their losses.

@SebastianJu Thanks for your response also! Perhaps I have an answer to your search for a profitable gambling system? Just measure your success in how much fun you had at the casino. 

Youre right though i think mostly people dont mean gambling when they suggest "invest in dice site". They mean investing in the house, which is a pretty sure way of income if you take the insecurities about the site owners away.

Though there are really some that think there might be a method to earn from gambling. I can understand that. Martingale sounds so great logical... until you really have thought it through.

Excellent advice Rodeox.  Especially the gambling.  It is fun to gamble but it drives me nuts when people ask for investment advice and someone responds by telling them to gamble.  Look at gambling as an entertainment expense.  How much would you spend on a video game or to go out to the movies?  Budget a weekly/monthly amount for ALL entertainment expenses, and don't go past it.  Gambling comes out of that fund, not investing funds.

For investing I would like to add some of my own thoughts.  Let me preface this by saying that I have not invested much with bitcoins/in the bitcoin world.  I have however been investing in stocks for years.  My returns for stocks are 20-30% a year depending on market conditions.  If you are not familiar with stock investing, then just know that this is a very good return.  I am out right now: I cashed in on almost everything because I feel that the market is overvalued, and with interest rates going up soon it will turn to a bear market.  I can make money in a bear market no problem, but with the Greece debt thing and other factors I feel that there is a good chance of a crash.  I am not predicting a crash, but I want to preserve capital above all else.  So I am playing it safe.  Anyway here we go:
 
1. Don't pull the trigger until you are SURE.  This is my rule #1.  If you are looking into an investment you should plan on waiting to pull the trigger.  I spend at least 20 hours researching a stock and often many more hours that that.  And after all of that I usually don't end up investing.  You have to be patient and willing to sit on the side.  Too many people get excited and want to jump in right away.  But this is how you get hurt.  Use that energy to research the investment and be sure that you are making the best possible decision.  If you lose out on an "opportunity" and feel that you got left out, DON'T PANIC.  Don't feel like you missed out or lost money because you didnt jump in.  I have found out the hard way that you are much better off losing an opportunity here and there and getting it right.  I had to learn the hard way by losing money.  And I hate losing.  You need to understand that there is an great opportunity every day of the week.  You just need to learn how to find it.

2. Look for red flags first.  The first thing I do when researching an investment is to look for red flags.  Why spend hours and hours researching to find that there is a red flag preventing me from investing?  The only thing I hate more than losing is wasting time.  There isn't enough of it and you shouldn't waste yours either.  For example my friend gave me a tip on a hot stock.  It is a company in the emerging ecig industry, one that makes vaporizers for weed based products. I started with the balance sheet (often a great place to start) and discovered that 90% of the company value is listed as "good will."  Without going into detail, to me that means that the company is 90% worthless.  I was done, I didnt need to waste more time on this one.  So in this case it took me all of five minutes to research the company.  Time saved!  How are they doing now?  Don't know and don't care.  They may have shot up by 1000% by now.  But that isn't the point.  The point is to choose the best investments that have the best chances of success.  You can't predict the future so don't beat yourself up if get it wrong.

3.  Have reasonable expectations.  If the investment promises ANY return be suspicious unless it is a bond, cd, money market acct, etc.  If they offer really high returns like 1% or more a day, then run and hide.  Sure some people play the HYIP game and hope to get out in time, but this is a dangerous game and unless you REALLY know what you are doing you will get burned.  If you are looking into a cloud mining site, just look at the numbers.  Are they selling hash for much cheaper then their competitors?  If so, why?  If you can't find out why then maybe best to avoid them.  One example of reasonable expectations is the pacmic by hashnest.  Basically it gives a reasonably safe return of ~20% a year.  I was shocked when people on the forums were complaining that the return was low.  If you guys have any idea how hard you have to work for a 20% annual return in the stock market then you would be jumping at the chance to get the pacmic, its a solid investment from a trusted company.  The point is that if it is too good to be true then it probably is.  I am just glad that big investors have not found out about certain markets yet.  When they get wind of things like hashnest s5 hash (return of 3% ~10 DAYS!!!!! when I bought in) then they will flood the market with new money, and it will be HARD to get 5% a year let alone 20.

OK I have a list of about 20 things that I use as a guide when investing, but I think this is good for now.  Remember, its better to preserve your capital then to try and get rich fast.  Some people manage it, but its like the casinos in vegas:  you hear the 1/100000 people that win big but the other thousands never brag about how much they lost.

Invest safe and make money the EASY way by not losing it in the first place!

Good suggestions guys. One thing I heard from an investor was "I try to tell if they are selling me on giving them money, or selling the idea they want funded". That sounds right. If they believe in their idea then it's all they talk about. If they are just focused on money and soft on the idea then perhaps your money IS the business plan. 

Also the idea of directly investing in a commodity like gold makes some sense. I really only do physical gold. Paper gold has some drawbacks to consider. In any case I think it's a good hedge against catastrophic stock market decline.  There is also real estate. Land is the king of wealth, IMO. Like BTC, there is only so much of it and all other wealth comes from the land.

Whenever people are promising some kind of guaranteed return or the investment just doesn't make sense, hold off.

For example lots of ponzis guaranteed a certain percentage of return per week which is simply unsustainable knowing any kind of exponential math. Then you have to think from the perspective of the other party. If they could make money without you (cloud mining and mining contracts), why do they want you involved?

If those any of that doesn't pass the smell test, move along.

Invest in gold if you have any doubts with your bitcoin
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Youre right. I would like to add some points i had to learn painfully.

* Put really everything on the table. You have to sell everything when its the right thing to do and you should not hang on something emotionally because it was so successful in the past and it might become successful again.
* Not invested money is still way better than invested money that gives you 50% annual return. Because at first you lose 100% of your money. And the question is open if you get it back.
* Only invest if you surely knows who the receiver is and you have a contract with him of some kind. If not let it be. There is no chance that is good enough to make compromises.
* Never invest if you fear you lose a chance or that waiting will make you lose. Emotions are bad for decisions and if i feel that way then its better to not invest until your mind is free and you still think its a good idea.