Win-win strategy, mutual funds and Bitcoin

Bitcoin can be a very profitable investment and one can set foot in this asset in several ways (buying, mining, trading, etc.) while mutual funds can be bought from a mutual fund company, a lending institution or other brokerage firms.

The main differences between the products and how to invest in Bitcoin

The goal of any investor is absolute capital protection and a profit on this, depending on the phase of the economic cycle we are experiencing, there tend to be more or less profitable actions to take and more or less safe investments, Bitcoin and mutual funds contain both advantages.

Bitcoin, born in 2008 in the hands of the unknown Satoshi Nakamotois a peer-to-peer cryptocurrency that is based on its own protocol and utilizes blockchain technology.

The digital currency is based on Proof of Work unlike other cryptocurrencies, which are based on Proof of Stake and therefore do not consider mining.

Adhil ShettyCEO of Bankbazaar, states that:

“It’s not fair to venture into what you can’t risk losing. Buying an asset at peak prices can lead to short-term losses, but it is best to ask yourself how long you are willing to hold on to your profits. Investors can limit their cryptocurrency money based on their risk-taking ability.”

This is the idea of ​​Shetty, who always advises his clients to consider risk appetite and time frame, therefore how long they allow themselves to see results in terms of return for the money they put in.

Rachit ChawlaCEO and founder of Finway FSC, on the other hand, leans squarely on the side of funds that remain very skeptical of Bitcoin and its future, saying she is concerned about its long-term survival:

“When investors buy shares, they actually become owners, they are part of the assets owned by the company. So everything is very tangible when it comes to mutual funds and shares. On the other hand, bitcoin is mainly speculation and it is still not known exactly what it guaranteed purchase is.”

The optimal investment

BTC’s assistance comes from only the most unexpected place. Yashpal Sharmavice president of Taurus Mutual Fund, which is supposed to be reluctant to spread capital to different assets, explains how he is in favor of Bitcoin and that he believes it should be present in investors’ portfolios as long as they are aware that the volatility of the investment can be high and that the timeframe to remain more comfortable with having a good return is between 2 and 4 years.

Another issue, admittedly not related to return on investment, is bureaucratic. BTC is an investment that is so easy to make today. With just a few clicks, you are in this world while putting resources into an investment fund, the process takes longer, whether you do it physically in an office of the institution you apply for it online. In addition, the transaction fees are high, while they are for Bitcoin uniformly limited over time.

The alternative may be not to choose one or the other instrument, but rather to build a varied and balanced portfolio as well according to one’s risk appetite and secure with other investments according to the direction taken.

In recent years, some central banks around the world, first the Canadian and Australian central banks, and later the Fed and the ECB, have authorized the issuance of financial instruments called ETFs based on cryptocurrency and Bitcoinwhich are actually funds that are yet another tool in the hands of institutional investors as well as private investors who want to set foot in this asset by combining the aspects of the two types of investments (BTC and Funds for that matter).