The financial markets have been heavily focused on the stock space over the past year, which is not entirely surprising given the fact we are consistently posting new record highs in both the Dow Jones and the S&P 500. Whenever we are dealing with a market context that resembles these trends, it can become much more difficult to "buy low and sell high" on the course to maximizing profits for your portfolio.
One alternative that has quickly emerged at the forefront is cryptocurrency, which is a digital currency alternative with its own set of unique trading characteristics. This has taken some by surprise since gold and silver will typically assume these roles.
Exciting investment opportunities can be seen when we see a new initial coin offering (ICO) for an inventive crypto currency asset. With all of the choices currently available, it is important for investors to select the most innovative and valuable assets.
Covesting is the most recent entry into the space and is introducing the concept of peer-2-peer asset management to crypto currency markets.
The approach that has a solid performance record in the classical equity and forex markets and these advantages are now available for anyone interested in investing in cryptocurrencies. When investors are able to make communal trades that benefit from social advantages and added experience, it is much easier to mitigate risk in what many analysts have described as volatile markets.
From an investment perspective, we can see much more excitement being directed toward cryptocurrencies when we look at the price charts themselves. These trends look set to continue into at least next year. If you are looking at trading opportunities outside of the stock space, gold and silver have started showing severe signs of stalling, creating opportunities for those using cryptocurrencies as an alternative for the more traditional position stances in the financial markets.
The latest rallies in these crypoto currency areas began after September, with markets recovering from post-summer losses that temporarily changed the outlook. In addition, we should remember cryptocurrencies are also working as a counterparty to the U.S. dollar and other world reserve currencies. At the same time, it must be remembered conservative position stances are recommended given the strong price moves that can be seen in these assets.
The real test here will occur during the final months of this year, as this is typically a period characterized by further rallies in the stock market. There is reason to believe this will not be happening this year given we are trading at such elevated levels in the S&P 500. But since the gold and silver space has been all but abandoned by the markets at large, it is clear investors will need to find asset alternatives for their portfolio in order to achieve true diversification and the potential for growth in capital gains.
