21
Apr, 2020

The Battle of Returns

Most financial markets are on the edge as many investors have liquidated their positions and look out for new investments. The liquidation brought new cash in investors’ hands, which brings nothing from an investment perspective.

 

There is a common phrase in markets “cash is trash”, as over-returns of the market were lucrative for any investor who didn’t want to hold any cash, fearing to lose those returns. Of course, before and during any crisis, the winners hold cash and have bigger chances of success.

 

The most common investments are stocks and bonds. Most investors distribute their portfolio between the two, finding the right portions between return and risk.

 

In this battle, there are also alternative investments. The most popular are gold and oil, both physical assets. Among others, there are Bitcoin and other cryptocurrencies.

 

Cryptocurrencies’ returns seem to react positively in the global shock like gold and bonds. This phenomenon shows that investors are expected to further downturn in financial markets and want to profit from alternative investment scenarios.

 

It will be clear over the next days if Bitcoin will follow the markets or will differentiate as a safe investment haven in a crisis period.