Thank you for the post! Very good point. Fundamentals play a critical role in long-term investment. But what about bitcoin? People agree that there is no fundamental in bitcoin but its long-term return is also unbelievably huge. What's your comment on that?
Bitcoin doesn't have the same fundamentals available as stocks (such as net income or revenue) but we wouldn't expect it to because it's a different asset class. Think about real estate, art, gold, and so on. They don't have the same fundamentals as stocks either but it's widely agreed they have value. With Bitcoin, we need to think about different metrics since traditional ones may not be available. And, at the end of the day, with stocks, fundamentals don't tell us everything about price. If it did, we wouldn't see what we've seen with GME or AMC or many other stocks.
Thank you for the post! Very good point. Fundamentals play a critical role in long-term investment. But what about bitcoin? People agree that there is no fundamental in bitcoin but its long-term return is also unbelievably huge. What's your comment on that?
Bitcoin doesn't have the same fundamentals available as stocks (such as net income or revenue) but we wouldn't expect it to because it's a different asset class. Think about real estate, art, gold, and so on. They don't have the same fundamentals as stocks either but it's widely agreed they have value. With Bitcoin, we need to think about different metrics since traditional ones may not be available. And, at the end of the day, with stocks, fundamentals don't tell us everything about price. If it did, we wouldn't see what we've seen with GME or AMC or many other stocks.
Thank you for the educational reply! I really love your articles!