Average investors are often accused of buying high and selling low.
And that may very well be the case for investors who are jumping on the bitcoin bandwagon. Bitcoin, a digital currency, has doubled and then some since the start of 2017 (it’s risen from $1,016.30 on Jan. 2 to $2,469.38 as of June 16) and many investors are taking note that a $1,000 investment in bitcoin in 2010 would now be worth $35 million.
To be sure, many experts, including Goldman Sachs, are turning bearish on the digital currency at its current price. But that hasn’t stopped investors from asking the question: What about the long-term? Should I invest in bitcoin in my accounts earmarked for retirement, which could be decades away and then last for decades?
Does it fit in your portfolio?
In the main, as with any investment, experts say investors should evaluate the pros and cons. What’s more, investors should take the very same approach to investing in bitcoin as they would any other investment: Evaluate whether it meets the criteria established in your investment policy statement, which outlines your time horizon, risk tolerance and investment objective.
How to invest in bitcoin
Assuming you’ve done all that, Jack Tatar, co-author of “Cryptoassets: The Innovative Investor’s Guide to Bitcoin and Beyond,” says there several ways to invest in bitcoin and other digital currencies in a retirement account.
Bitcoin Investment Trust: The easiest way, he says, is to invest in the Bitcoin Investment Trust (GBTC), the first publicly quoted securities solely invested in and deriving value from the price of bitcoin. According to the investment firm…