Chart Of The Day: What Was The Biggest Fall Today?
I know many of you are very sad because the promising price surge in cryptocurrencies ended abruptly and Steem is on a low not seen since January. That’s because I brought you this simple chart, with two normal stock prices.
The one is the stock of Netflix, which reported quarterly results with decreasing user numbers. The other is the German software firm SAP, also reporting for Q2 today. Both were worse than expected, much worse. That’s because Netflix unanticipated fell 11 percent today, until the time of writing, and SAP approximately five percent.
That has no direct connection to cryptocurrencies and Steem but is instructive. You can see that not only cryptocurrencies can move 5-10 percent in a single day. Maybe cryptos are a very risky asset class, but not the only one. Investing in general, in assets where the price is determined by the free market needs always high courage – and risk-tolerance capability.
Pain is a pain, everywhere
I suppose – and I have seen in some earlier dPoll polls – that many of you on Steemit and other Steem pages have only or almost only cryptocurrencies invested. Maybe it was painful to lose 10 or 15 percent in a day (or, in other cases, 75-95 percent in a year). But you can feel these pains also on the stock market, commodities market or by forex trades.
It hurts to lose 11 percent on some sort of crypto, but it also hurts to lose 11 percent on Netflix. That’s why you should be diversified: buying, holding not only cryptos but also other assets. And not only one, better more. Some crypto, some stocks (various), maybe some bonds or some gold. Later, If you have money, maybe some real estate property.
Your future self, your future you will probably thank you for that. Unexpected things can also happen.