1 reason why institutional money will NEVER go big on PonziCoin
Diupdate
We compare a BTC baggy speculator to a largely diversified fund.
We assume risk rewards are the same and on 1 side the BTC baggy takes 2 huge trades over a 2 year period, the diversified fund has 200 positions in total, in bacthes of 10 that are held approximately 10 weeks each. This is quite similar to reality. I also compare the 2 time BTC gambler to a speculator that takes 10 smaller trades instead of 2 huge one, and demonstrate that even this small difference makes a HUGE difference result wise (spoiler: he makes 75 times as much money).
45% to make 125% once/once
100* 0.45 to make 100*1.25
0.45*2.25 = 1,0125 (amazing)
For the smart speculator the formula (0.9955^100)*(1.0125^100) is incorrect it assumed every trade is compounded.
Let's look at a speculator that holds 10 position at once.
Because (1+x)*(1-x) = 1 - x² < 1, and the bigger the loss the harder to comeback (lose 1% only need to make 1.01% - 1% more only to breakeven, lose 50% need to make double that (100% more) to breakeven), I'll affirm without going into too much details that:
The best case scenario is in each batch of 10 trades the speculator wins 5 loses 5
The worst case scenario is the speculator loses all trades in 10 batches of 10 in a row & wins 10 of 10 in a row.
Best case scenario, he makes 20 times 0.9775*1.0625=1,03859375 (0.45*5=2.25 and 1.25*5=6.25). Note how this is already more than the amazing Bitcoin total returns. 20 times this compounded is => 1,03859375^20 = 2,13.
Worst case scenario 10 times 0.955 then 10 times 1.125 => 2,049.
The diversified speculator doubled his money.
The dumb moon chaser that got "the bull run of his life wow such big % best performing asset" broke even.
I just want to bang my head on the wall when I hear "best performing asset".
There was a guy on tv that said this.
OF COURSE he also smiled like an idiot.
OF COURSE he made no sense zero logic.
OF COURSE he uttered the incredibly stupid sentence "If I knew how to predict the future I would not be here I would be at the beach".
I can compare it to a third, that only takes 10 trades in total in 2 years. Risked 9% each time to make 25%.
0.91^5*1.25^5 = 1,9044. Almost doubled his money.
Of course most Bitcoin dumb money is not risking 45% to make 125%, they are risking 100% to make "moon".
I wonder what returns they believe can give them (all by the way) 100% back. Oh but of course "it will never happen".
They will grow old holding their bags to zero and vanish into oblivion.
And let us not forgot that idiotcoin does this:
And let us not forget that idiotcoin price action shows INFERIOR setups to what we regularly see elsewhere.
I assumed for this that baggycoin had as good risk rewards, but here we can see this is not the case.
This is just 1 example but it is always like this... So things are actually even worse...
Nice, wait months and months of flat price action for this crap?
When there are much better opportunities based on the weekly chart too on a DAILY BASIS?
"Uuuuh but price only went up 4% my retardcoin went up 8900%"
- Mathematically illeterate simpleton that also has no clue about leverage (if he really wants a one time big number due to mathematical illiteracy).
And since all crypto are correlated and alts are unpredictable, no self-respectable fund is going to go more than 1, maybe 2 percent, in crypto.
Oh I said self-respectable, not that would be zero percent. I mean the crazy ones.
If big money comes in (Soros) it is either small (Rothschilds that are trillionaires put 100k in emmm do BTC baggies know what percentage this is? They probably have more spare cash in their pockets), OR they are in to extract as much money from baggies as fast as they can (Soros broke the bank of england).
There is ABSOLUTELY NO REASON for professionals that want to make money to go in BTC buy&baghodl. They can make more with less risk.
They also know this is an unethical ponzi scheme and often have a reputation to protect. But I won't get started on other reasons they will not throw money at retail "believers".
One day they will realize that the people pointing & laughing and calling them idiots were not just joking but meant it, and they were not 'just mad they missed out', and it will hurt hard.
They are going to fall from so high. It will be like the 6th elements, they will realize they were the suckers all along. I preped my pop corn and I cannot wait. Going to be very amusing.
We assume risk rewards are the same and on 1 side the BTC baggy takes 2 huge trades over a 2 year period, the diversified fund has 200 positions in total, in bacthes of 10 that are held approximately 10 weeks each. This is quite similar to reality. I also compare the 2 time BTC gambler to a speculator that takes 10 smaller trades instead of 2 huge one, and demonstrate that even this small difference makes a HUGE difference result wise (spoiler: he makes 75 times as much money).
45% to make 125% once/once
100* 0.45 to make 100*1.25
0.45*2.25 = 1,0125 (amazing)
For the smart speculator the formula (0.9955^100)*(1.0125^100) is incorrect it assumed every trade is compounded.
Let's look at a speculator that holds 10 position at once.
Because (1+x)*(1-x) = 1 - x² < 1, and the bigger the loss the harder to comeback (lose 1% only need to make 1.01% - 1% more only to breakeven, lose 50% need to make double that (100% more) to breakeven), I'll affirm without going into too much details that:
The best case scenario is in each batch of 10 trades the speculator wins 5 loses 5
The worst case scenario is the speculator loses all trades in 10 batches of 10 in a row & wins 10 of 10 in a row.
Best case scenario, he makes 20 times 0.9775*1.0625=1,03859375 (0.45*5=2.25 and 1.25*5=6.25). Note how this is already more than the amazing Bitcoin total returns. 20 times this compounded is => 1,03859375^20 = 2,13.
Worst case scenario 10 times 0.955 then 10 times 1.125 => 2,049.
The diversified speculator doubled his money.
The dumb moon chaser that got "the bull run of his life wow such big % best performing asset" broke even.
I just want to bang my head on the wall when I hear "best performing asset".
There was a guy on tv that said this.
OF COURSE he also smiled like an idiot.
OF COURSE he made no sense zero logic.
OF COURSE he uttered the incredibly stupid sentence "If I knew how to predict the future I would not be here I would be at the beach".
I can compare it to a third, that only takes 10 trades in total in 2 years. Risked 9% each time to make 25%.
0.91^5*1.25^5 = 1,9044. Almost doubled his money.
Of course most Bitcoin dumb money is not risking 45% to make 125%, they are risking 100% to make "moon".
I wonder what returns they believe can give them (all by the way) 100% back. Oh but of course "it will never happen".
They will grow old holding their bags to zero and vanish into oblivion.
And let us not forgot that idiotcoin does this:
And let us not forget that idiotcoin price action shows INFERIOR setups to what we regularly see elsewhere.
I assumed for this that baggycoin had as good risk rewards, but here we can see this is not the case.
This is just 1 example but it is always like this... So things are actually even worse...
Nice, wait months and months of flat price action for this crap?
When there are much better opportunities based on the weekly chart too on a DAILY BASIS?
"Uuuuh but price only went up 4% my retardcoin went up 8900%"
- Mathematically illeterate simpleton that also has no clue about leverage (if he really wants a one time big number due to mathematical illiteracy).
And since all crypto are correlated and alts are unpredictable, no self-respectable fund is going to go more than 1, maybe 2 percent, in crypto.
Oh I said self-respectable, not that would be zero percent. I mean the crazy ones.
If big money comes in (Soros) it is either small (Rothschilds that are trillionaires put 100k in emmm do BTC baggies know what percentage this is? They probably have more spare cash in their pockets), OR they are in to extract as much money from baggies as fast as they can (Soros broke the bank of england).
There is ABSOLUTELY NO REASON for professionals that want to make money to go in BTC buy&baghodl. They can make more with less risk.
They also know this is an unethical ponzi scheme and often have a reputation to protect. But I won't get started on other reasons they will not throw money at retail "believers".
One day they will realize that the people pointing & laughing and calling them idiots were not just joking but meant it, and they were not 'just mad they missed out', and it will hurt hard.
They are going to fall from so high. It will be like the 6th elements, they will realize they were the suckers all along. I preped my pop corn and I cannot wait. Going to be very amusing.
Catatan
I wanted to draw ridiculous lines that go back in time to see how many simpletons would take the bait but did not bother since tradingview biased mods silence me.But apparently there are people that come to my profile do not check the content do not read anything, just looking for simple lines which is the most their brains can process.
I have proven they were idiots but they are still coming for more...
This is... embarassing...
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