Should investors consider buying Bitcoin?

Question:

I am retired and happy with my conservative portfolio performance. I am considering buying some Bitcoin with a small percentage of my portfolio.

I would appreciate your views on this proposal.

Monday Morning Millionaire Program Answer:

Here is a Morningstar headline: “You can now hold Bitcoin in your RRSP, but should you?” (An RRSP, Registered Retirement Savings Plan, is tax-advantaged and is similar to the 401K in the US.)

Adding fuel to the fire, Warren Buffett, calls Bitcoin ‘rat poison squared’.

Bitcoin is the oldest of the hundreds of crypto currencies in existence. Many have a history of fraud.

The best that we can say is that you plan to commit only a small percentage of your portfolio to it. Having said that, please note that the Monday Morning Program position on investment commitment is that that the smaller it is, the more meaningless it is.

Regardless of how a small commitment performs, its overall impact on portfolio performance is negligible.

From page 5 of our award-winning book Monday Morning Millionaire: “Historically, over the long term, properly selected market index exchange-traded funds, held in tax-advantaged accounts, have been the investor’s best way for growing savings and are likely to remain so for many years.”

Over the last two decades,  Monday Morning Program has outperformed over 90% of portfolios including professionally managed ones. I have a$100,000 standing bet that it will continue to do so in the future.

The program includes buying the US economy as a whole (no stock picking) and avoiding complexity. Could anyone explain Bitcoin to a 12-year-old?

Please note that the Monday Morning Millionaire Program contains opinions only. It does not provide any investment advice or endorsements.

Dr. Milan Somborac

The Monday Morning Millionaire Program supports do-it-yourself (DIY) investors which I have been for over 50 years. About my team and me

Schedule Your Free Half-Hour Discussion

Get in touch with us and schedule a free half-hour discussion with Milan.