- Bitcoin’s price history arguably shines a light on BTC’s correlation with the global stock market
- KB Crypto uses clients’ BTC funds to derive immediate gains from diverse assets like indices
- Any gains made are shared with the investor in the form of BTC, keeping clients’ holding intact
Tradable assets come with their own set of advantages and risks. The foremost advantage is appreciation in the price of an asset an investor owns. Capital gains accrue, making it easy for the investor to cope with the rising prices of goods and services during times of high inflation.
Risks, however, can be a dampener. Be it precious metals or stocks trading on an exchange, no asset is without this underlying risk. An ‘alternative investment’ asset that has piqued the interest of enthusiasts is Bitcoin (BTC). From Canadians to Americans to investors in emerging economies, many are adding BTC to their portfolios.
But variable-return assets -- that include BTC as well -- may not be so easy for an amateur investor to manage. BTC has been very volatile as compared to other traditional assets.
How has BTC fared over past few years, including both during pre-COVID-19 pandemic and pandemic phases? And, is there something that KB Crypto, a Canadian hedge fund, brings to help enthusiasts tap the full potential and also mitigate risks?
BTC price movement
BTC price was as low as US$1,500 almost five years back. Before 2017, BTC was arguably an asset for only a few participants. Data suggests the 24-hour trading volume of BTC surpassed US$100 million somewhere around mid-2016 for the first time. Today, this volume ranges in tens of billions of dollars.
Data provided by CoinMarketCap.com
By the end of 2017, BTC had skyrocketed to nearly US$13,500. The year 2018 was a bad one for both BTC and the S&P 500 Index. Another popular crypto asset ETH also did not fare well that year. Bulls thronged BTC in 2020, the year when it registered almost 300% price appreciation.
At one time in 2021, BTC reached nearly US$68,000. In 2022 so far, the price has remained subdued, but the same bearish trend can be said to have also impacted other variable return assets. Carvana Co., listed on the NYSE, and which broke into the Fortune 500 list last year, is down nearly 80% this year.
From rising interest rates to subdued economic growth, many factors may be behind this subdued phase in variable-return assets.
Image source: Screen Grab KB Crypto PPT
How does Canadian company KB Crypto help?
KB Crypto claims to be unlike any traditional hedge fund. It uses BTC to tap other markets, which can include commodities, indices, and foreign currencies.
KB Crypto is of the view that its strategy diversifies investors’ portfolios in a way that suits the present-day investment landscape. Besides, many cryptocurrency holders may subscribe to the popular HODL (hold-on-for-dear-life) approach. It means not liquidating assets to book short-term capital gains. These idle BTCs, KB Crypto asserts, can be used smartly to garner short-term profits on diverse assets.
Any profit made using the BTC holding of a client is shared with an investor in the form of BTC. That way, clients can gain from their BTC without having to liquidate it on any exchange.
Risk Disclosure: Trading in cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory, or political events. The laws that apply to crypto products (and how a particular crypto product is regulated) may change. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading in the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed. Kalkine Media cannot and does not represent or guarantee that any of the information/data available here is accurate, reliable, current, complete, or appropriate for your needs. Kalkine Media will not accept liability for any loss or damage as a result of your trading or your reliance on the information shared on this website.