Bitcoin (BTC) surged past $18,000 on November 18, peaking at $18,488 — a three-year high. With a 151% annualized return, it outperforms traditional assets. But should you go ALL IN on Bitcoin or crypto?
Renowned index investor "Greenhorn" likens investing to driving: most aim for a reliable journey from point A to B, not Formula 1 glory. Similarly, investors typically seek steady returns rather than overnight riches or Buffett-like status.
Cryptocurrency circles often echo FOMO-driven calls like "ALL IN Bitcoin" or "Buy now, ask later." Yet this approach exceeds most investors' risk tolerance, contradicting prudent investment principles.
The Volatility Reality Check
- 2020 Bull Run: Bitcoin yielded 151% vs. S&P 500's 11% and NASDAQ's 31%
- 2018 Crash: BTC plunged 84% from $20,000 to $3,200
Would your portfolio survive such swings?
What Is Asset Allocation?
Two Strategic Dimensions
- Spatial Diversification
Combine low-correlation assets (e.g., 50% ETFs + 50% bonds) to hedge against market dips, as advocated in Benjamin Graham's The Intelligent Investor. Temporal Diversification
Capitalize on economic cycles via the Merrill Lynch Clock Theory:- Reflation → Bonds outperform
- Recovery → Stocks shine
- Overheat → Commodities lead
- Stagflation → Cash prevails
Recent examples:
- Tech stocks (Apple, Tesla) surged during lockdowns
- Tourism stocks rebounded on vaccine news
Crypto's Cyclical Nature
Treating crypto as an emerging sector reveals its dependency on capital rotation cycles. Without knowing whether blockchain represents sunrise innovation or sunset hype, overconcentration risks inefficiency and instability.
Buffett Bets Big on Post-Election Markets
Warren Buffett's Berkshire Hathaway made strategic pivots in Q3 2020:
- $4.8B in biotech/5G stocks (AbbVie, Merck, Pfizer)
- $3M Snowflake (cloud computing) shares
- T-Mobile US positions
This signals confidence in:
✅ Smooth political transition
✅ Vaccine rollout
✅ Stimulus package passage
FTX Equity Tokens: Trade Stocks as Crypto
FTX's trading competition (started Nov 11) offers:
🥇 1 Berkshire Hathaway token (~$340,000)
🥈 Tesla Model S or equivalent TSLA tokens (~$69,000)
🎁 20 random winners: 5 Beyond Meat shares (~$700)
Why FTX Stands Out
- Actual stock-backed tokens (custodied by CM-Equity)
- Full shareholder rights (including dividends)
- Unified platform for crypto + traditional assets
Popular available tokens:
| Stock | Ticker | Sector |
|---|---|---|
| Apple | AAPL | Technology |
| Tesla | TSLA | Automotive |
| Pfizer | PFE | Pharmaceuticals |
| BioNTech | BNTX | Biotechnology |
FAQ: Smart Crypto Investing
Q: Should I liquidate all assets for Bitcoin?
A: Never allocate more than 5-10% of your portfolio to high-risk assets like crypto. Balance with stable investments.
Q: How do economic cycles affect crypto?
A: Crypto often moves independently, but macroeconomic liquidity impacts all risk assets during crises.
Q: Are stock tokens safer than direct crypto?
A: They carry traditional market risks plus exchange dependency. Research underlying assets thoroughly.
👉 Discover advanced trading strategies