A round up of interesting or cool stuff I’ve read.
Bitcoin’s quiet ascent
In much quieter fashion than the last time, Bitcoin is slowly approaching new highs. As of the end of October, it has risen 87% year-on-year and, at the time of writing, has reached a value of £13,245.45. Back in the Bitcoin hysteria of 2017, it reached a record high of £15,500. Now that everyone is starting to take notice, I wouldn’t be surprised to see it increase further in the next few months. Whether it stays there or drops again, who knows?
I have to admit to feeling a degree of FOMO. However, there are a few reasons why I remain hesitant to get involved.
For a start, Bitcoin still remains hugely volatile.
I’m not fully convinced about how secure one’s Bitcoin holdings might be. For example, I trust that no one is going to be able to steal the contents of my ISA. Furthermore, companies like Vanguard are covered by the Financial Services Compensation Scheme and are regulated by the Financial Conduct Authority. To my knowledge, the same cannot be said for Bitcoin.
There’s also the issue that, much like gold, Bitcoin doesn’t do anything. It’s value is entirely based on how much other people are willing to pay for it, and it doesn’t pay dividends or interest.
Finally, and perhaps most importantly, I know next to nothing about it. As Warren Buffet is attributed with saying, “never invest in a business you cannot understand.”
Not to say that I don’t think Bitcoin has a place in an investment portfolio. On the contrary, I do think it has its place, and I might dip my toe in in the future. Slow and steady does it though; the most I would be willing to allocate is 5% of my holdings, with 1-2% being more likely initially.
For now, however, I shall stick to my core strategy of investing in equities, and remain an interested observer!
Other interesting links that caught my eye this week:
- Money Mage lists 5 Reasons to be Happily Childfree.
- On the other hand, those of you with children may be interested in Gentleman’s Family Finances article on How to avoid the child benefit trap.
- Tony from One Million Journey shares his thoughts and notes from the hugely successful book, Atomic Habits – Millionaire Mindset #5 – Build Good Habits. I haven’t gotten around to picking up the book yet despite all the great things I’ve heard about it, but Tony has written a nice primer on the topic.
- An interesting article from Vanguard on the ways that a financial advisor might provide value to their clients.
- Ben Carlson from A Wealth of Common Sense shows how even investing a mere $20 a month can lead to a decent sized nest egg after 30 years of compounding.
- Finumus has seen the other side of FIRE… And is apparently bored already! Not many FI bloggers have actually reached an early retirement. It’s interesting to read the perspective of someone who has.
- The Physician on FIRE shares a guest post from a couple who are taking a slower path to FI, allowing them to enjoy the ride – When Financial Independence is Irrelevant.
- Indeedably had a far more interesting time at school than I did – Shadow Trade.
- The Guardian reports on a study that says that 1% of people cause half of global aviation emissions, which sounds crazy to me. Perhaps an indication that frequent flyers should be taxed more than those that fly no more than once per year?
- Apparently Elon Musk is set to become the world’s third-richest person, as Tesla is about to be added to the S&P 500. Ben Carlson shows that index investors won’t notice either way.
- MeowTalk: Alexa developer’s app to translate cat’s miaow – BBC. I had to check the date; apparently this is not an April fools joke!
- Three seconds – #Film4Climate Best Short Film Winner 2017
- I can’t be bothered with most bank switching offers these days, but I find myself sorely tempted by Virgin Money’s offer of 15 free bottles of wine.
- u/reckless-saving is running a FIRE UK Survey 2020 and is hoping to get 200+ responses by the end of November. More details on the FIREUK subreddit.
- Sign up to Trading212 via this link and we both receive a free share.
Thanks for reading. Hope you’re all having a good week.