Posted by ustonapc at Feb 20, 2022 7:06:18 PM
Re: How Risky is Bitcoin?
Georg,

The article from your link compares the risk/return profile of a buy & hold (B&H) strategy for Bitcoin/Telsa vs spy.

This may not be a realistic measurement as most successful traders that makes money in Bitcoin trade it (long/short) based on some form of trending following technical analysis (TA) like moving average/MACD/Parabolic SAR. I have added a number of research papers in my Bitcoin thread which has validated using TA to trade Bitcoin/Ethereum which improves the Sharpe ratio by reducing the max drawdown to 25-35% (as compared to over 50%+ for B&H which happens every year).

From someone who has made money trading Bitcoin, I won't recommend a B&H strategy unless anyone is ready to stomach a 80% max drawdown.

Disclosure : I have no position in Bitcoin after taking profit at the 53,500 level based weekly Parabolic SAR.

Regards
James