The main talking point this week, was the Chancellor’s budget. Which sought to provide additional forbearance on furlough, and extend the stamp duty holiday. It’s become customary to mention Bitcoin in my updates, and we’ve all witnessed the exponential rise in 2020. However every so often we’re reminded of its fragility, especially when the US Federal Reserve are concerned.
Most people view Crypto as a hedge (protection) against the traditional markets or even inflation. But the recent pull back (selling of crypto) has shown signs that some holders are panic selling, and doing so at a loss for the first time in years. Which is indicative of those buying at such a high price without the nerve to sustain fluctuations. Covid-19 has contributed to an increase in the number of Ultra High Net Worth individuals in the world (net worth of >$30m).
Those who’ve profited have done so mainly though diversification, equities and property. Having long term investment strategies in areas like Tech, allows such growth to offset the losses in other areas. The country which saw the largest increase in the number of UHNWI in 2020 was China, with a 16% rise whilst the USA in comparison only saw a 4% increase. It’s easy to feel that you’ve missed out on a big break because you didn’t profit from the economic downturn. But you’re not alone, most people in the world didn’t. Sometimes your resources wont allow for risky bets, and someone asked me this week why it’s easier to turn £1m into £2m than it is to flip £10K into £20K… i’ll leave you with that question.