Bitcoin powers crypto market rebound

Hola folks!

Happy Monday! I hope you guys had a great festive weekend celebrating Navratri and Durga Puja! The festivals celebrate divine power and the victory of good over evil. Let’s work to conquer the spread of reckless consumerism so that we can create more wealth over time. Maybe it is time to reset our savings habit this Dusherra.

In today’s newsletter, we will talk about how we can inculcate the savings habit to invest more irrespective of the value of the savings. We will also give our investments a modern twist to build a balanced, all-weather portfolio that can stand the test of time.

Read on to learn more about savings, investments, the crypto market, and much more so that you can make an informed investment decision this Dusherra.

Fixed deposits have been around for a long time. Their popularity hasn’t faded even as newer investment alternatives offering better rates of investment have come into the fray. This is partly because FDs are one of the safest investment alternatives available in the market and partly because they are easy to book and redeem. But not all FDs are the same. Watch the video below to understand the difference between short-term and long-term fixed deposits.

You can choose the best-suited fixed deposit product for you based on the information given in the video and your research. This Dusherra, you can give a modern investment twist to the gold-buying tradition by booking a fixed deposit for the tenure that best serves your needs.

Up next, we have another popular investment alternative - Mutual Funds — as a way to increase your wealth incrementally over time.

All investments have a minimum investment value attached to them. For example, if you want to buy physical gold, the smallest quantity you will get is ½ a gram. While ½ a gram is a very small quantity in money terms, you will have to spend over Rs. 3000 to buy it and 3k is a considerable amount for someone who is starting their career and is also starting their investment journey.

What can be done in this case? Should the person just wait to save until he/she starts earning more? or, can they can start their investment journey right away with an investment alternative that has a smaller minimum investment value attached to it?

The answer is simple, money invested today, irrespective of the investment value, is better than money invested at a later date. Therefore, it is better to start investing Rs. 1000 that you have extra today than to wait for more money that you might have in the future.

Here is where Mutual Fund investments come into play. You can start your mutual fund investment journey with just Rs. 100.

The minimum value of mutual fund investments is so affordable that even students on pocket money can start investing in it. And once you start your investment journey with mutual funds, you can decide on a certain percentage increment every year to create wealth as time passes.

Let’s understand this with an example.
A 20-year-old starts investing Rs. 500 every month at a return of 12% per annum with a decision to increase the investment amount by 10% every year for the next 30 years. He/she will get a total of Rs. 41,50,890 at the age of 50 years. Of the total amount, the invested amount will only be Rs. 9,86,964. The individual will get a return of Rs. 31,63,926 on the total investment amount of only Rs. 9,86,964!

The numbers are astonishing. The auspicious day of Dusherra is the right time to start your investment journey irrespective of the ticket size.

In a dramatic week of gains, crypto markets bounced strongly last week as BTC moved up by almost 10%.

The week started with its fair share of controversies as a piece of fake news regarding BTC ETF approval was tweeted by CoinTelegraph taking BTC to 30k USD almost immediately. Within the next 15-30 minutes though a few sources close to Blackrock clarified no such approval was yet received which created a massive correction. BTC however continued its upward march, with the investors now more aware than before on how a bitcoin spot ETF approval rally might look like! The markets have since remained bullish - with BTC dominance rising up to ~50% which is a 2.5-year high.

Very unique in the current macro situation, is the decoupling of BTC and crypto from other "risk on" assets, as equity markets have bled last week with S&P 500 and NASDAQ correcting sharply in the backdrop of geo-political escalations in the Middle East. A huge draw for any portfolio manager is the diversification offered by uncorrelated assets, as pointed out by Larry Fink, Blackrock CEO, and pitching the case for Crypto as an institutional asset.

In major crypto movements last week, tokens having a close relation to Bitcoin have been making headlines. STX, which acts as a layer 2 for Bitcoin, moved sharply.

Other major movers of the week included popular Ethereum competitor SOL with an impressive 30% move breaking major resistance levels.

Several other blue chip tokens like AAVE, LINK moved up strongly, with >20% gains last week.

Another notable altcoin move came from the AI-based token Render Network, with GPUs looking like the go-to resource for the upcoming technologies, it makes sense that people are hoarding up either Proof of Work cryptos which need GPUs to mine, or distributed GPU systems like RNDR.

• BTC $30,645 ⏫ 10.06%

• AAVE $83.72 ⏫ 28.43%

• LINK $10.45 ⏫ 38.10%

• RNDR $1.99 ⏫ 7.22%

(All data here is as of 2:30 p.m., 23 October, 2023)

Before we conclude, here’s a quick look at some important news from around the crypto world.

• The US SEC on Thursday voluntarily dismissed charges against Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen, both of whom had been charged alongside the company for allegedly violating securities laws with sales of the XRP token. Read more here.

• The crypto winter may be over, Morgan Stanley Wealth Management said in a post on its website examining whether the recent bear market in digital assets has run its course. Read more here.

Today’s book suggestion is an investment cult classic. This book about value investing comes with a recommendation from the greatest investor of all time Warren Buffet. A few of you might have guessed the book by now. Oh yes, I am talking about the Intelligent Investor by Benjamin Graham.

The Intelligent Investor

By: Benjamin Graham

This book is a timeless investment classic authored by one of the greatest investment minds of the twentieth century, Benjamin Graham. Graham talks about his philosophy of "value investing" -- which shields investors from substantial error and teaches them to develop long-term strategies. The Intelligent Investor has become the bible for stock market investing since it was first published in 1949.

Over the years, market developments have underlined the wisdom of Graham's strategies. While preserving the integrity of Graham's original text, this revised edition includes updated commentary by noted financial journalist Jason Zweig, whose perspective incorporates the realities of today's market, draws parallels between Graham's examples and today's financial headlines, and gives readers a thorough understanding of how to apply Graham's principles.

Vital and indispensable, this edition of The Intelligent Investor is the most important book you will ever read on how to attain your financial goals.

Before you get on with your day, don’t forget to flex those brain muscles with our weekly crypto crossword.

That’s it for now. Thanks for sticking around.

See you later, folks! 👋

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