Did You Make 504% In Each Of The Last 7 Years?

Did You Make 504% In Each Of The Last 7 Years?
Underwater by Andy Deitsch. Why?

Yes, you did read it correctly.  It does say 504 per cent per year.  That's how much Bitcoin grew in value.  See how you could benefit below.

If You’d Bought $100 Of Bitcoins On 1 September 2010, Seven Years Later On 1 September 2017, You Could Have Cashed Out For $8,251,200

Bitcoin Could Have Earned You A Compound Interest Rate Return Of 504 Per Cent Per Year For Each Of The Last Seven Years

bitcoin bitcoins

That’s somewhat higher than the 1 per cent per year you might earn if you deposit your money in a bank or building society.

But don’t be fooled - these are definitely not the same sort of investments. 

A bank deposit is guaranteed by the Financial Services Compensation Scheme, at least up to the first £85,000 per institution. 

Bitcoin, by contrast, is a very high risk speculative investment.  It carries no such guarantee. 

One of the main risks is price volatility.  This is perfectly illustrated by the fact that Bitcoin has either been the best or the worst performing currency in each of the last four years, with nothing to be found in between.

bitcoin bitcoins

Bitcoin Is Growing In Popularity

Recent research shows there are currently between 2.9 million and 5.8 million people around the world using a crypto-currency like Bitcoin. 

Bitcoin is now accepted in many places, including large international businesses like Starbucks.  And whilst that appears to provide Bitcoin with an air of mainstream respectability, it’s quite rightly caught the attention of the regulator.

In September 2017, the Financial Conduct Authority released a stern warning about investing in Initial Coin Offerings (ICO).  An Initial Coin Offering raises money for a specific project or company through the issue of a physical coin in exchange for a crypto-currency, such as Bitcoin.

In addition to highlighting six key risks, the regulator says:

You should only invest in an ICO project if you are an experienced investor, confident in the quality of the ICO project itself (e.g. business plan, technology, people involved) and prepared to lose your entire stake.

Here’s the full Bitcoin warning.

The UK financial services watchdog is not alone.

China has banned Initial Coin Offerings, saying it was necessary to stop illegal fundraising and pyramid schemes.

The US Securities and Exchange Commission issued an “investor alert” in July 2017 to make investors aware of the potential risks.  In August 2017, regulators in Singapore and Canada also cautioned investors about the sector.

How To Get Exposure To Bitcoin And Other Crypto-Currencies

eToro offers a passive, diversified crypto-currency CopyFund in Bitcoin and the other major crypto-currencies.  The company was established in 2007 has about 6 million users in 170 countries. 

So if you fancy a punt, click the image below.  But please heed this warning ...

Whilst eToro may be regulated by the Financial Conduct Authority, only do this if you're prepared to lose your entire stake (the words of the regulator, as you can see above).

bitcoin bitcoins

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AJ Bell Is Often The Best Value SIPP For Stockmarket Assets

That's our opinion.  Not just because AJ Bell was the first company to offer an online SIPP.  Nor that it's received many prestigious awards.  And not even because the wife of SIPPclub's Founder has an AJ Bell SIPP.  It's because it's one of the most competitive stockmarket SIPPs on the market. 

Over time, charges can wipe out a huge part of your fund.  We like AJ Bell because there are no set-up costs.  If you hold passive funds, which is our preference, or shares, investment trusts, EFTs, gilts or bonds, you pay one small fixed fee no matter how large your fund.  And when you come to draw your benefits either as occasional drawdown or UFPLS payments, there's a small charge for the whole year no matter how many times you access your money (many SIPP and SSAS providers charge more than this for each payment).  However, you should always compare charges in detail, because AJ Bell could be more expensive than other providers, depending on the type of stockmarket assets you hold.

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As SIPPclub neither advises on, nor arranges, nor recommends specific investments or strategies, we're unable to say whether a SIPP or SSAS or any investment within it is right for you. Ultimately, it’s your money and your decision, and you should only proceed once you're satisfied you've undertaken sufficient due diligence. If you need advice, you should speak to your trusted adviser, or you could find a local adviser from Unbiased.co.uk.  Alternatively, we'd be pleased to introduce to a suitably qualified independent financial adviser.

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Trading derivatives including Contracts for Differences (CFDs), Futures and spread betting carries a high level of risk to your capital, and is not suitable for all investors. CFDs are leveraged products. Trading in CFDs related to foreign exchange, commodities,indices and other underlying variables, carries a high level of risk and can result in the loss of all of your investment. As such, CFDs may not be suitable for all investors. You should not invest money that you cannot afford to lose. Before deciding to trade, you should become aware of all the risks associated with CFD trading, and seek advice from an independent and suitably licensed financial advisor. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to CFDs or (b) any direct, indirect, special, consequential or incidental damages whatsoever.

Only speculate with money you can afford to lose. Trading or placing any bets can result in you incurring liabilities in excess of your initial stake. However, in the case of investment made from your SIPP or SSAS, your losses should be limited to the amount you invest, though these kinds of investment may be unacceptable to your SIPP or SSAS operator. Please ensure you fully understand the risks, and seek independent advice if necessary. Past performance of a managed service is not a guide to future performance.