Share markets on the precipice - I am hedging using Cryptos.

in #crypto7 years ago

**Autotrading programs in equities, have increased the risk of a cascading market due to high degrees of leverage through Margin trading to increase yields in a tight market. Never before have investors been so heavily reliant on Debt while seeking profits. This will cause the next retraction in the market to be more severe than previous down turns.

Low interest rates, have caused investors to discount the potential for a downturn in the market, many simply are too far exposed to pay a margin call if the market where to retrace even 5-10%. This will cause them to sell their equities to fund the margin calls, and cause even greater and more rapid total falls in the share market.

While investors are often earning very small passive profits from their autotrading, many do not realize that the potential for massive losses is increasing with ever declining volatility. The next share market upheaval may be postponed by tax cuts, but it is well overdue according to fundamental analysis.

The increasing risk of global economic downturn is multiplying as investors take greater risks every day chasing declining yield. For many the lure of high returns from Crypto currencies is causing them to diversify into Bitcoin and other Digital currencies.

This may mean that as old money is destroyed in the coming market collapse, many Crypto currency investors will become the new millionaires.**
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Interesting thoughts - I was thinking this morning about buying more cryptocurrencies given my experience with steem - all looks very promising! Good luck

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