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RE: All Investors Seem To Be Running To THIS Asset Class

in #bitcoin6 years ago

Yes, the thumbnail was icky and infected and therefore was worthy of getting attention. Good job.

Re: coinmarketcap and your point on “the gain following a drop has to be bigger” - I’m glad you pointed it out, and no, I don’t think it’s common sense. It makes sense once you explain it to people but I think most people don’t grasp that at first showing.

It’s like ESPP - not sure how many people are familiar with it but at some companies, there’s a benefit called an Employee Stock Purchase Plan. It allows you pre-allocate funds over time to buy stock at a discount, usually from the lower price between two far apart dates. One common example: 15% off the lower price of the stock on January 2nd or July 2nd.

Many people see that and think - “cool! 15% return on my money!”

No. It’s an 18% return on your money. Buying something at a 15% discount and immediately selling it is an 18% return not 15%.

(And that’s only if the stock went down in the period - if the stock went up then the return is higher since you’d get a discount on the lower price - the starting price - and then have stock that is worth more)

Same principle you’re describing about gain after a loss

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