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Crypto Crash

SchlongConery

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Jan 28, 2013
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.....so, if you sell corn forwards and you are not a farmer who expect to produce corn but some schmuck who simply thinks corn will increase in price - you are not using forwards the way they were intended, you are using them as a casino instead and I would say the same thing to him (i.e, he is an idiot) as I say to anyone who wants to trade crypto.

Learn the concept of optimal investment portfolio, security market line, and capital asset-pricing model, and efficient market hypothesis before doing any trading/investment on your own.

Prudent advice.
 

sprite09

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Agree, it is only a theory. Now, do you honestly believe that you (or average Joe) is smarter then all these professors and you will be able to beat the market? Theory is not always right, it is right 99.9% of the time. Are you smart enough to explore this 0.1%. Good luck :).
talking about crypto ...agree the avg Joe or even experts / profs cannot beat the stock market over time
 
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sprite09

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I have a feeling you either do not understand what I am saying or intentionally do not want to hear rational arguments. No one is saying that crypro is bad for speculation - people can do it any time they want to. But it is speculation, not investment. The difference is that, in order for someone to win, someone needs to lose. With stock investment the "average" person wins because firms make profit and stock pays dividends. You can make a parallel between options/futures and crypto - all of them are zero-sum game and all of them are, in some sense, just a lottery. The major role of forwards is to hedge, so, if you sell corn forwards and you are not a farmer who expect to produce corn but some schmuck who simply thinks corn will increase in price - you are not using forwards the way they were intended, you are using them as a casino instead and I would say the same thing to him (i.e, he is an idiot) as I say to anyone who wants to trade crypto. Learn the concept of optimal investment portfolio, security market line, and capital asset-pricing model, and efficient market hypothesis before doing any trading/investment on your own.
i know all those concepts about CAPM, EMH, tadda yadda

and I agree it's speculation as I've said many times , but if you actually understand how the crypto market works snd , there is much , much higher probability of making money (good money I'll add) than buying a lottery ticket, playing slot machines , day trading etc etc .

again, dont wanna speculate then don't
 
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sprite09

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So what's the difference?

Crypto is "printed" (aka mined) factories of desktop computers consuming perishable electricity for the sole purpose of maintaining the "value" of the virtual currency.

And crypto has lost more than 8.6% of its value ... this week!


Crypto is today's get rich quick scheme for those who would have been all-in with day trading, secret FOREX systems and casinos!

Go ahead and play with your fun money but it's a different mindset than real investing.
nah, crypto is way easier and higher probability to make money than day trading and casinos.
 

fall

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Dec 9, 2010
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i know all those concepts about CAPM, EMH, tadda yadda

and I agree it's speculation as I've said many times , but if you actually understand how the crypto market works snd , there is much , much higher probability of making money (good money I'll add) than buying a lottery ticket, playing slot machines , day trading etc etc .

again, dont wanna speculate then don't
It is not enough to "understand how the crypto market works", you must to understand and be able to predict it better than the "weighted average trader" (where weights are the amount of capital used by that trader). Now, if you think you can do a better analysis then the team of financial experts in big financial institution, you make the most common mistake: you are overconfident in your own abilities. A wise person would first understand his own limitations.
 

fall

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nah, crypto is way easier and higher probability to make money than day trading and casinos.
The probability to make money has nothing to do with the expected return. Most assets have high probability of going up a bit and small probability of going down a lot, so, you always have high probability to earn money.
 

sprite09

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The probability to make money has nothing to do with the expected return. Most assets have high probability of going up a bit and small probability of going down a lot, so, you always have high probability to earn money.
no shit ..it's risk and return
 

sprite09

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It is not enough to "understand how the crypto market works", you must to understand and be able to predict it better than the "weighted average trader" (where weights are the amount of capital used by that trader). Now, if you think you can do a better analysis then the team of financial experts in big financial institution, you make the most common mistake: you are overconfident in your own abilities. A wise person would first understand his own limitations.
we talking stocks or crypto here ? lol

it's called dollar cost averaging in and dollar cost averaging out based on a disciplined exit strategy when things run up...nobody can time bottom and top perfectly ..I'm aware of that

it's really not that complicated, but yes , as I've mentioned, guys have trouble pulling out (pun intended )

if you don't have the ability to do that, I get it ..then don't ..it's not for everyone
 
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fall

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we talking stocks or crypto here ? lol

it's called dollar cost averaging in and dollar cost averaging out based on a disciplined exit strategy when things run up...nobody can time bottom and top perfectly ..I'm aware of that

it's really not that complicated, but yes , as I've mentioned, guys have trouble pulling out (pun intended )

if you don't have the ability to do that, I get it ..then don't ..it's not for everyone
The major problem of an overconfident investor is that he does not know he is overconfident. You may be familiar with a famous study that shows that 90% of all drivers think they are above average :).
 

sprite09

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The major problem of an overconfident investor is that he does not know he is overconfident. You may be familiar with a famous study that shows that 90% of all drivers think they are above average :).
ok, fall, if you can't control yourself, I get it ...then don't do it

investor ? what are talking about here? stocks or crypto ? lol

a DCA out strategy is also recommended for stocks as well ....unless you believe a dominant percentage in equities near retirement is smart lol

and you may be familiar with the dunning kruger effect

ps...I don't think I'm an above average driver .
 
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fall

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ok, fall, if you can't control yourself, I get it ...then don't do it

investor ? what are talking about here? stocks or crypto ? lol

a DCA out strategy is also recommended for stocks as well ....unless you believe a dominant percentage in equities near retirement is smart lol

and you may be familiar with the dunning kruger effect

ps...I don't think I'm an above average driver .
But you think you are above average crypto trader who can earn money in zero-sum game. I got it :).
 
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sprite09

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But you think you are above average crypto trader who can earn money in zero-sum game. I got it :).

if your definition of above average is what a person should do investing in equities (ie DCA, hold, DCA out based on life cycle/financial circumstance such as retirement), but with crypto is done a shorter time frame.

and I suppose perhaps that's where we can agree on, because even people who are told to do that with stocks and play the long-term game, many cannot stomach the volatility (even using diversified index funds) and thus panic sell, likely at a loss.
 
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fall

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if your definition of above average is what a person should do investing in equities (ie DCA, hold, DCA out based on life cycle/financial circumstance such as retirement), but with crypto is done a shorter time frame.

and I suppose perhaps that's where we can agree on, because even people who are told to do that with stocks and play the long-term game, many cannot stomach the volatility (even using diversified index funds) and thus panic sell, likely at a loss.
As always in Finance, average is measured by the amount of money, not number of people. In fact, it should be median. So, if you look at all crypto traders (including ones who was seriously considered to buy but decided not to), rank them from the largest to smallest assets available to invest in any financial instruments (not just crypto), and then look at the person who holds the "median" dollar and all the people above him in assets (my guess, it will be less than 1% of all people holding cryptos), can you honestly say that you are smarter then them? Or you are just smarter than the average Joe with total $300K investment portfolio in all financial assets (excluding his own home)?
 

sprite09

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As always in Finance, average is measured by the amount of money, not number of people. In fact, it should be median. So, if you look at all crypto traders (including ones who was seriously considered to buy but decided not to), rank them from the largest to smallest assets available to invest in any financial instruments (not just crypto), and then look at the person who holds the "median" dollar and all the people above him in assets (my guess, it will be less than 1% of all people holding cryptos), can you honestly say that you are smarter then them? Or you are just smarter than the average Joe with total $300K investment portfolio in all financial assets (excluding his own home)?
You're associating this with intelligence? OK, perhaps if you think being able to handle the volatility and being disciplined is associated intelligence, then, OK.

I don't try to outsmart the market (whether equities or crypto) by trying to buy bottom and sell at top; nobody can do that consistently in the long run and if they do, it's just luck. That's why I DCA in, hold, and DCA out based on my own profit-taking strategy in crypto (equities I just buy and hold and will lower my allocation based on my life cycle, which is essentially the same strategy, but over a longer time horizon). I don't associate that being smarter than them; I just call that keeping my emotions in check and being disciplined by sticking to a strategy--experiencing major ups and downs in the stock market has helped me do that (and looking at crypto history, and noting that the correlation between the two markets is clear as day now).

If you think that's being smarter than them, then so be it.
 
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fall

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You're associating this with intelligence? OK, perhaps if you think being able to handle the volatility and being disciplined is associated intelligence, then, OK.

I don't try to outsmart the market (whether equities or crypto) by trying to buy bottom and sell at top; nobody can do that consistently in the long run and if they do, it's just luck. That's why I DCA in, hold, and DCA out based on my own profit-taking strategy in crypto (equities I just buy and hold and will lower my allocation based on my life cycle, which is essentially the same strategy, but over a longer time horizon). I don't associate that being smarter than them; I just call that keeping my emotions in check and being disciplined by sticking to a strategy--experiencing major ups and downs in the stock market has helped me do that (and looking at crypto history, and noting that the correlation between the two markets is clear as day now).

If you think that's being smarter than them, then so be it.
potato-potato. "my own profit-taking strategy", "keep emotions in check", "being disciplined" :). Overconfidence it is. And it is amplified by your "wins" in the overall raising crypto price in the last few years.
 

sprite09

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potato-potato. "my own profit-taking strategy", "keep emotions in check", "being disciplined" :). Overconfidence it is. And it is amplified by your "wins" in the overall raising crypto price in the last few years.
not everyone can do it ...like I said, most people have trouble pulling out. oh, and you do realize about order types, so there is no need for me to actually pull the trigger at the actual time of transaction.

keep doing your own thing , I'll do mine.
 
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fall

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not everyone can do it ...like I said, most people have trouble pulling out. oh, and you do realize about order types, so there is no need for me to actually pull the trigger at the actual time of transaction.

keep doing your own thing , I'll do mine.
You do not even realize how naive and funny your arguments are for someone with basic Finance knowledge. Order types :). Year, I bet if you learn what stop-loss order is, you are able to concur the market. Those pure schmucks at large hedge funds with all their MBA and financial engineering degree (who operate with more than 50% of all assets allocated or considered to be allocated at crypto) should lose money because you developed your own strategy and know how to place limit orders. You are the living example of an overconfident "investor" who becomes even more overconfident following the 10-year increase (really a short time) of a ponzi-type asset price with small probability of hitting zero. And this probability will realize over the long-term horizon where all the money will be lost, meaning that for you to benefit you must find the "final" idiot to sell it to, and, it seems you believe these idiot is not you but one of these guys with fancy finance degrees. Good luck :).