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MINING FOR CRYPTOCURRENCY
12/13/2018 11:21:32 PM
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By Gordon Pape  | Friday, October 05, 2018


Q – I have a bearish outlook on global equity market especially after President Trump has imposed tariffs on all the U.S. trading partners. Below are my questions:

1. What is your opinion on Hive shares? Since last year, I have lost more than 75% of its value.
2. I have around $5,000 to invest, and I would expect to get at least 7% annual return on it. Where and what can I invest in? – Hasnain H.

A – I assume you are referring to Hive Blockchain Technologies, which trades on the Toronto Venture Exchange under the symbol HIVE. I have never recommended this security, and a look at its chart shows it has been a very bad investment. It has dropped from a high of $6.75 last November to around $0.80 as of the time of writing.

The company website describes it as follows: “HIVE is strategically partnered with Genesis Mining Ltd., the world’s largest cloud mining company, to build the next generation of blockchain infrastructure. HIVE currently operates a total of four facilities (two in Iceland and two in Sweden) and are currently working on an additional two facilities in Sweden. Our facilities are capable of mining cryptocurrencies, like Ethereum, around the clock and will add our first Bitcoin mining facility by September 2018.”

This description tells us this is a highly speculative stock that operates in a fledgling and uncertain market. Perhaps at some point it will make a breakthrough, and the stock will move higher, but it is not the type of security I would ever recommend.

In regard to your second question, there are many securities that have the potential of giving you a 7% return. The question is now much risk you want to take. You won’t get 7% from a low-risk investment like GICs or government bonds. So, you need to look at stocks, ETFs, or mutual funds. I have offered many ideas about securities that could generate returns or 7% or more to discuss with your advisor, but all come with some degree of risk. Right now, I would look at stocks or ETFs that focus on U.S. healthcare or technology companies.

Gordon Pape is one of Canada’s best-known personal finance commentators and investment experts. He is the publisher of The Internet Wealth Builder and The Income Investor newsletters, which are available through the Building Wealth website.

For more information on subscriptions to Gordon Pape’s newsletters, check the Building Wealth website.

Follow Gordon Pape on Twitter at https://twitter.com/GPUpdates and on Facebook at www.facebook.com/GordonPapeMoney.

Notes and Disclaimer

© 2018 by The Fund Library. All rights reserved.

The foregoing is for general information purposes only and is the opinion of the writer. Securities mentioned carry risk of loss, and no guarantee of performance is made or implied. This information is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting, or tax advice. Always seek advice from your own financial advisor before making investment decisions.

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