Part 10/12:
Markets often climb in parabolic fashion during meltups. Investors should be cautious not to buy at the peak but instead look for pullbacks or dips to build positions.
- Diversify Across Asset Classes
During liquidity-driven booms, various assets—from stocks and cryptocurrencies to precious metals—may perform well. Diversification helps mitigate risk from sudden corrections.
- Warning Against Excessive Margin Use
Borrowing to invest (margin debt) amplifies risk. In a volatile environment, margin calls during downturns can wipe out gains and leave investors exposed. It's safer to limit leverage and prepare for inevitable pullbacks.