CHAPTER 7-Missing the Opportunities
We took a glimpse into our planned future, but we are still in Phase One where the small successes today will be greatly rewarded in the next two phases. But let's take some time to talk about the "Buy and Hold strategy in light of what was taught in the previous lesson. I own more cryptocurrencies than TROPTIONS. A little diversification is usually a good idea, so I own BTC, BAT, ETH, LTC, XLM, COMP, BAL, ADA, DOGE, and DOT. Depending on the day's activity, I lose ground and gain ground, but the trend over the years tells me that I am up over 1000%.
I also own some stock, including Tesla, Snowflake, Costco, Target, McDonalds, Alphabet, LuLumon, Airbnb, Disney, and PayPal to name a few.
My basic investing strategy is literally to "Buy and Hold" with a strong expectation that my investments will grow while I do other things. These are passive investments with a long view in mind. I have no interest in "Cashing Out" and running off with taxable profits .... yet.
This day, Bitcoin dropped to $45,111 from a high of $69,000 in just a month. I was a little disappointed, but I bought more Bitcoin because I considered this $45,111 a fire sale. I might be 100% wrong and Bitcoin can drop another $10,000. I have absolutely no control over what the price will be tomorrow, next month, or next year.
The Buy and Hold Strategy
The course has spent a lot of time demonstrating the unique opportunity to "Make Deals" trading TROPTIONS for all kinds of things. This is the optimum strategy for building wealth, but it is not the only way to build wealth. The goal of the TROPTIONS network is to leave no one behind. So, there is a clear and reasonable strategy to "Buy and Hold" in the expectation that the whole story of TROPTIONS has not been realized yet.
My strategy for my other investments is 90% "Buy and Hold". I have no intention of trying to sell off my investments because I have the unproven expectation that each of these may have explosive growth and a bigger payday yet to come. So, I recommend that any TROPTIONS holder is welcome to take the passive route of holding onto their TROPTIONS as the better part of this crypto asset is yet to be seen.
During your holding period, your growth is tax-deferred under the current tax rules. That means your balance is not reduced each year by a tax payment and that means future growth is better when you do the math. And don't forget, the benefits of tax planning with your accountant.
If my Bitcoin goes to $100,000 and I want to cash our $10,000 initial in Bitcoin will expose a $5,000 profit. Even as a "Passive Buy and Hold" investor, I can give $5000 in TROPTIONS to my church and claim an offsetting write-off. So, though I did not make a trade as some big hitters, I still used my TROPTIONS to save me the tax on the $5000 gain. If the capital gain tax was 20%, that equals $1000 of money that stays in my pocket. That's money I can reinvest.
Dollar-cost averaging (DCA) is an investment strategy in which an investor divides up the total amount to be invested across periodic purchases of a target asset to reduce the impact of volatility on the overall purchase. The purchases occur regardless of the asset's price and at regular intervals. Simply stated, the investor may not have a lot of money to invest, so they build a portfolio by buying a certain amount each month.
In the belief that the stock market always goes up over the long run, the current price doesn't matter because the DCA investor is looking at the long run.
The DCA strategy compared to the person making deals with their TROPTIONS is the "Rabbit and the Tortoise" story. In the story, either one had a strategy to win the race. The rabbit ran hard and figured that he had no competition. The tortoise ran the slow and steady race. As strange events happen in life, the rabbit makes a critical mistake, and the tortoise wins the race.
We hope that anyone who elects to follow the "Buy and Hold" strategy or the DCA system will prosper greatly. Both approaches are legitimate and respected strategies.
In other words, do not be intimidated by the emphasis placed on the more aggressive strategy of trading for things. Trading is an option, not a requirement, for any TROPTIONS holder. What none of us can predict or promise is what the future of any investment will look like. There is always a risk for any strategy.