All Your Eggs in Three Baskets
You have all heard the saying "Don't put all your eggs in one basket..."
the rest of that saying requires thought and the ability to foresee what the problem would be in doing that. For those that may not possess that faculty, I will explain it. It is presumed that if you drop the one basket, then all the eggs will be broken and rendered useless.
Still some people are sold on some coin that is "heading toward the moon..." as they say, and they start stacking all their eggs in that one basket just the same.
We will talk about the many baskets later. For now I will tell you what I had planned as my wealth grew. I wanted to "have money" and I got that - see my first post on Wealth Tips. For those of you who are comfortable with money just sitting there not being spent, it is time to make sure it is not all in one place, the proverbial "onebasket".
My plan was to have roughly thirty percent in gold and precious metals, thirty percent in cryptocurrencies and thirty percent in S&H Green Stamps. Then I would make adjustments to whichever of those three piles was lower than the rest.
After that, I started cutting up the money within each basket into other baskets, none of which could be dropped and ruined individually or collectively.
After further thought, I sold my dollars (aka S&H Green Stamps) because they have an expiration date, plus the value is constantly falling. I can buy them as I need them, if I ever need them, which is less and less these days. I am thoroughly amazed at the quantity of earth dweller who will give you really great products, including my motorcycles, just so they can have those green stamps.
Baskets within Baskets
Lets start with the metals. There are investment bulk silver and collectable silver coins. Gold comes in ingots, coins, and a thick gold foil that is quite divisible until you cannot weight it anymore.
Crypto coins are divided into the large trusted coins like bitcoin, litecoin, and their various forks. Much of the crypto wealth is invested in the most time tested protocols. I do cold storage and keep the keys behind layers of security and in many locations.
Staking coins get another sizable percentage of my investment capital, Hive comes to mind along with Leo and ProofOfBrain tokens that seem to be doing well. I have a cap for this type, but I would not be against doubling my stake in the near future. I like that I hold the keys and it seems secure as long as I am careful.
Then we have privacy coins. I like these because I am finding it harder and harder to spend bitcoin and traceable tokens these days with all the algorithms that try to identify who is who. I have put some bitcoin into Wasabi wallet and it makes them private, but some will call you a thief just for mixing your coins.
Enter Monero! Due to its unbreakable (up until now) ring signature technology I am starting to stack these and grab more when the price is down like now. I would group Particl into this group as well since its wallet uses both bitcoin and Monero code and swaps between the two of them.
Finally, there are the new project coins. I only put one 1/100 of my wealth in these but I love them because the majority of my wealth in crypto has come from tiny investments that can end up in the tens of thousands or even into the six figure range. This group of coins occupies the smallest percentage of money earmarked for crypto. I like to invest between $100 and up to $1,000 in each depending on the age and activity of each.
Why the Break down?
As I may or may not have said last post. I looped a lot of my USDT back into my base cryptos when bitcoin fell below $27,000 because you have to buy low at some point. Since then we are having a dry period where all coins just kind of linger in the depressing price ranges.
Two are up: Doge and Particl
I am not willing to spend my Doge until it goes above forty cents and Particl is a hope coin for me. I want that market place to take off as people, myself included, run from ebay, paypal, and banks. I will hold on to Particl and only give it up when I have to.
Doge, Particl, or Hive which are all way above what I paid for mine. Hive is still at three times what I paid for it, but it is hard to sell Hive since it pays me to hold in through voting and because I have seen it much higher over the last couple years. To me Hive is not a sell option while in the mid thirty cent range.
A Person Has to Live Though
My USDT has been paying all my expanses for the last year. I have about six months more that I could live normally only on this one asset. Still, when gold is fluctuating and hits two thousand, I use it to get those green stamps (dollars). For now, dollars work extend until the slump is over.
The gold I have was collected over the last fifteen years and it is as good as a house in beating inflation. Each coin I have is worth three times what I paid in nominal dollars.
My USDT was purchases using seventy-thousand-plus bitcoin and other assets that fluctuate with bitcoin. I do not want to spend this USDT all at one time. Every USDT I spend is like having super-dollars that can buy things everywhere with sixty five percent off! If I did not have these few assets that are holding past values, every LTC or XMR I spend would be buying only fifty percent of the merchandise that it would have two years ago.
Every month worth of bills can be played like the market and leveraged in the same way. Having my money in many baskets protects it and limits my losses if one coin should crash and burn. But the point of having divisions and subdivisions, each with their limits, allows for sensible spending when everything seemingly is down.
I could spend Hive to live right now and I would be "up" as they say. But why would I choose low Hive to sell when there is another asset that is doing better than other cyrptos. Sell that one.
If this goes on for ten years, I would be out of metals and cheap USDT by then, and I would spend Hive that is only slightly in the green. But really, I am attempting (successfully) to avoid all losses by having options.
The point is to control spending so that one has money, which gives you those options. Then manage the baskets, as illustrated here, so that you can spend the asset that is not having a bad week when you have to buy things.
Thanks for reading. Comment. And have a good weekend.
1 How to Have Money
2 Debt and Percentages
3 Waste not, Want Not
4 A Practical Example
5 Cost Averaging for Investing
6 Overnight Successes
Sorry for getting so late to this post, but I just wanna comment that it took me to think more on its central topic from another perspective. Although I need to go first through your Wealt Tips series, having in count that I'm just at the first stages of sound building of economical success, a neccesary step to think in these moves with the baskets and strategic savings. Best regards from Cuba.
That is examplary. There was a time I'd never relate to this post, but surely, I actually can at the moment. I like the fact that you choose to always sell the stable or best performing asset, because this is how you get to squeeze out more value for your assets. As for Hive you're definitely making the right decision, I like to think I'm undergoing a diversification process at the moment, I hope it eventually works well for me. It's good to see your post after a while, how have you been?
I am good. I tend to get out and enjoy life. I ride a lot and when home, I tinker with motors and inventions in the shop.
Other projects that I did not want to reveal yet: I am running a staking node that has turned more profit than the same staked amount would here on Hive. If I had $50,000 in it, it would make $4,000 per month - the same in hive here turns about $600 - I am not knocking Hive. I am just diversifying. I will be testing and researching the node project then upping my investment to $10k - around that same time, I am thinking of doubling my stake here on Hive as I said above.
I read your last post. You and I are a lot alike. You have become an expert at surviving and hold stability above all other virtues. I always opt for stability as well and now with years of that discipline, I have learned to do more than survive. I find my stability by only investing a small percentage of my liquid assets. That way, if I am out and something crashes, I am not motivated to deal with it now or run home to move funds around and avoid disaster.
Hahaha I know you love to take some time to let go of life's stress and have fun. It's good to hear of the node investments, I think you're one who doesn't take diversification lightly and even when it goes sideways it's easy to take comfort in projects that are doing well or just move assets whatsoever, this is a huge motivation for me.
Yes, thanks a million. I find stability to be at the basis of my actions or inactions. I think this is because of my upgrading and having experienced a lot of distability while growing up. Hopefully, you can write more often. Cheers.
if when we have all the eggs in a single basket it is complicated since by lowering the price for any reason we could lose a lot of the money that we obtained with so much effort. The logical option could be the one that you describe in great detail, but for that you have to have all the given conditions and make our plan work.
The price going lower does not mean a loss of money (value). If you sell your coins when the price is low, then you have indeed lost money.
It is true, but if we have no other option, we would resign ourselves to losing money.
Having all your eggs in one basket you run the risk of losing them all was a good investment especially the gold, here in my country once the state sold gold to the public but the vast majority lost their investment, it is also important to know who you are buying from.
Very true! I know who I am buying from and don't let the government know that I have gold. They do like to come knocking so that they can grab our assets. . .
Indeed very wise says! Agree that we shouldn’t put all our eggs in one basket like we shouldn’t invest on only coin or asset. For me next 3-4 months I can hold my coins, if it start pumping then great, if not then I may have to sell it. Trying to think positive as things can be change in a second and a little profit will be great.
You are wise that you invest on gold and multiple coins, be hopeful for something big. I don't have doge coin but people who invest on multiple coins has high chances to make profit. Wish you get good profit from your investment, my holding is not big but still I'm hopeful! Have a nice day! 💓💗💖💝
I always love your comments. They say a lot about hopes and you always wish me good profits. I wish them for you as well.
If at some point in the near future you will need to sell, then you likely have too much invested (compared to the money you have for investing). This is exactly like painting yourself into a corner.
That means that you have created a situation where you will have no options open except to abandon your investment strategy and sell at a really low price. You probably did not think about what happens if the price drops as much as it has.
I avoid this by saying to myself, "If this coin goes to zero, how much do I want to have invested?" (because I know I will not sell when it drops below 50% of what I paid for it). Then I plan accordingly and only invest as much as I can afford to lose. This is a very important principle that would have saved many who wanted to maximize profits while abandoning any notion of risk.
Well I'm glad that you loved my comments which means a lot to me 🥰
Actually my holdings are my earning not that big but I've invested my precious time that's true. Your points are very logical and wise, I appreciate. Everything can be happen with crypto tomorrow but deep in my heart, I do believe our investment (time and money) wil bring profit. I feel the positive vibes. And yes I've invested as much I can afford to lose but still it can be a great support to bring financial freedom for several months.
Thank you for your kind and wise reply and I also love your post as I'm still leaning about coins and I'm not so knowledgeable about crypto currencies. Stay blessed 💖💝❤️
It may interest you to know that I have lost everything three times in my life. The most recent time was in 2001. Since then, I worked my way up to where I am. The articles that I am writing now include cautious spending and investment strategies based on holding most of your wealth and never losing it (again).
I am stable in a tragic market environment. It is a true test of my conclusions drawn from my life. I am attempting to share that with all of you. You seem to be alright - I hope you are. Take care and you also be blessed!
rolemodel/ example to me :)
https://peakd.com/@woelfchen/i-cannot-access-my-bank--6-years-of-pain--soon-homeless-again
when come new posts by you ?
Having all the eggs in one basket is risky and needs to be spread to avoid losing all if it crashes. I appreciate your thoughts on this and thanks for sharing.
It is a common misconception that something can crash and lose all your money. If you have all your money on an exchange that has no-opt-out for margin trading like PrimeXBT - you are 100% correct. Otherwise, coins rarely go to absolute zero. The news media has repeatedly reported that bitcoin has gone to zero (hoping that it would) but they are trying to cause that rather than reporting reality.
Bitcoin never went below $40 when MtGox went under. The price of imaginary bitcoins on MtGox went down near zero but in reality, Gox only contained no bitcoin in its cold or hot wallets at that moment.
Other coins might be considered dead but I held mine and my private keys for those wallets, then watched them spring back to life and make profits unimaginable.
Some coins I owned, and by "owned" I mean $200 or less, like DRK, XRP, FTC, Doge, etc. were considered dead by me yet I held the keys and did not sell low. The came back to life and I saw 1.3m, 67k, 40k and 4m in returns respectively. There are others but these are the ones that come to mind.
Wow this is so educating and I must say I like your strategy, it's emulative.
I'll say that logic of spending the coin that's doing well and not the one that's still struggling to come up... Is a perfect one, I mean we hodl coins to wait for better days and then when they do, we let them be to sell off the ones still coming up? Not logical.
I find this series interesting, will be on the look out for more of it. Until the next, I'll go read up the others lined up here in the post haha.
Well written Sir (Ma) 😅
little tricks that can help us maintain profits in times where it is difficult to do so
Interesting read, thanks for the insight. Any thoughts on holding USDC instead of USDT?
I tried several Tether wallets.
First, they are not real crypto. Here are my experiences as of now.
Omni Layer had faults in my first tests and I now have $5k tied up in a Coinomi wallet - Need to transfer all moneys out of that one and then put my seed into a recovery tool in order to get the private keys - then put those keys into an Omni wallet - and I will hope there is no KYC at that point. . .
I tried USDT(trc20) and it works well with no questions asked on the imtoken wallet. I am not opposed to anything as long as it does not force me to interface with governments that should not be worried about me. I keep my USDT at or below $10k.
USDC is not one that I have tried. I may try it in the future, but I am limiting my interaction due to the lack of decentralization in these.
I never hold more than $5k on an exchange and I treat Tether coins the same except for HBD - I would hold up to 200k in that.
Great read. And thoughtful... I have just two baskets aside from the green papers which will hopefully last me till the next bull market and both baskets are filled with crypto.
Maybe I will be able at some point to diversify. Real estate is something that's on my mind now.
I am also thinking of getting some real estate. I can't make large purchases like that until crypto is back up in the ATH level though. I have a lot of people offering me nice pieces of property right now though. So tempting but not smart to ignore good sense.
A 250k house purchased today with crypto will be looked back on with contempt. "Why did I buy this little home for 13.1 BTC?" (at $70k BTC - you are talking $920k)
I will wait until the same house only costs me three bitcoins.
Definitely. It's after the next ATHs when I will consider realocating.
Hmm, how about spending the money you make off Hive through voting and locking up, this way you still have your capital and not touch it, While you wait for the price to skyrocket?
Have you seen my wallet here?
Hive stands at about 35% of my total capital. It was paying a thousand per month for just voting. It still pays the same amount in Hive Power, but the price is lower so it is less than a thousand. The dollar amount means nothing to me. We won't be pricing things in dollars for much longer.
That is great, I am accumulating and hoping that in future my Hive stake will be enough to pay for thousands of dollars my bills too through voting too. It will take time but it’s worth it.
Great you're happy to store assets in crypto. Of course money should be kept in different places like eggs. Even if the eggs of one basket are broken, the eggs of the other basket will give profit. Very nice discussion from you,
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Thank you very much friend @ezrider . Which has given support to the mushroom image that I display. How are you today, I hope you are always in good health and fine.
Some great thoughts as always man! I'm hoping to develop that kind of a regiment over time, as I know it takes time to do these types of things. One of the things that's for sure is that it's increasingly more difficult to maintain some type of anonymity with these assets. I'm hoping to scoop up another hardware wallet or two so that I can spread my stuff out between them and not have all the eggs in one basket. Granted I've got a lot of other things as well but it's always good to split up a stake like bitcoin into different wallets instead of just one wallet with a lot.
Metals - I ought to sell some of mine because of the price that I bought them at, I don't need the money but it would be good to sell and take some profits to the reinvest later. I know the companies are buying the metals at quite a premium right now compared to what I bought them at a while ago. Not too bad to see some appreciation on an asset!
Hive is definitely one of those assets that I don't plan on selling for various reasons but one of them being that I want it to keep growing and maturing so that I can improve that stake a lot more for when I eventually do want to take some off the top to do some things, on chain or off.
Dear @ezrider,
May I ask you to review and support the new HiveSQL Proposal so we can keep it free to use for the community?
You can do it on Peakd, ecency,
Thank you!
thanks for the support @ezrider
thank you so much for the support @ezrider
Hello Sir, I always hear about this gold and silver stack or investment I'm in the UAE right now and there is many shops who are selling gold even the gold bar small to large size what do you recommend for a beginner like me to do?
And also I hear from a friend when you buy gold send it to the bank and the bank will sell it at higher price for you so we get the profit is it true?
Thank you in advance
Hello, have a good day @ezrider🙋🙋🙋
Inflation is killing our savings.
We will develop new strings of incomes. Hive can help in the process of creating a brand to share to the world our creativity.
Peace
@ezrider please be endeavor to check on my blog and contents once in a while. Thanks so much in advance.🙏🏿
Hey king! We need you, you're a such valuable member of the HIVE community and we need your help to bring the most advanced NFT market to HIVE that will integrate all the games and offer a new level experience to the NFT traders on all our blockchain. We're running a proposal and your vote is necessary to reach the goal. Thanks in advance king!