I have mentioned a couple of times that we are in the first two years of actually using crypto and blockchain as real products and tools. The use of Defi exploded in 2020.
Trading using decentralized finance, or non-traditional platforms for cryptocurrencies known as DeFi, has exploded 10-fold from 2020 to $150 billion in total value at its peak this year. Link.
This is a two decade long (at least) business growth spurt. This maybe the last major technology wave for me to catch and enjoy. Well, no I am too curious about life and investing to not be on the hunt for interesting investments. I am really excited on this technology theme. I don’t expect to immerse myself actively in the Metaverse. Maybe in the future, but for now, I am happy to get involved in finding and owning the companies building this new world.
The reason to mention Coinbase is that they are one of the builders of this new digital world. Today Coinbase laid out its outline concerning the Metaverse. I suspect buying Coinbase now is like buying the companies who helped build-out the early internet / smart phone infrastructure. Companies like Apple, Microsoft, Google and Amazon. At this moment in time, Coinbase could be one those companies. So, I see Coinbase as a company to buy and continue to buy – accumulate, and own and trade around a core position for a ten to twenty year plan. If you are a trader, great! Check the chart out below. Can you trade Coinbase with that movement? You sure can!
One tactic I learned from collaborating with traders over a career in the brokerage business is the concept of having four to eight companies you know well and trade them for a life time. Slowly you’ll replace one here or there. Honestly, many successful people do this. It is how they get successful. It is more the Speculator Within, than Investor or Trader. Focus, concentrate and execute your plan.
A challenging problem with the stock market is there are too many stocks to choose from. If you limit yourself to ten stocks and that is all you can trade for the next ten years, you will either be wildly successful or find out you are not a trader. No other paths out of the Ten Stocks to Trade Box when you limit yourself to ten stocks. You will succeed or fail, period. You will also get to know yourself very well. It is a great personal growth exercise.
Coinbase could be on this list of one of the Ten Stocks to Trade Box. The duel purpose is wealth building and trading Coinbase. With the money allocated to Coinbase, consider a position size of 70% of the allocation being a core position. The other 30% is your trading allocation in this stock. All the tools when you trade. P selling puts and calls buying puts and calls trading the stock – use all the tools to work your company. You will entrain yourself physically, emotionally, and mentally with the price movement, so you no longer need to think and decide what you are doing. You Know what to do Instinctively.
How Coinbase thinks about the Metaverse December 16, 2021, 5 minute read
Coinbase’s stock is out of favor at the moment, but as a shopper, don’t you love buying your straw hats in the dead of winter?
- Looks like good price support in this $225 to $260 area.
- Short-term over sold
- Connection to Finviz stats page.
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