Jeff Parent B. Eng. FCSI CIM
HIVE Blockchain Technologies
HIVE-X
DON'T BUY
Jul 27, 2018
Clearly has some problems. Slow, steady decline and volume’s dropping. Volatile stock. Be very wary. He’s not a believer of blockchain technology, it’s just a fancy database. Now a penny stock, so will be off the radar of many. If it can break above $1.70, might be more interesting.
He is pretty skeptical on the number of companies that claim to have an advantage in this space. If the value of cryptocurrency goes down, these companies will be at risk. It has a lot of cash and is well known. It is not a real long term strategy in his mind yet.
Run big data centers that mine crypto currency. Its chart looks like Bitcoin. It is in a descending triangle. If it breaks below support, it would reflect badly on it.
(A Top Pick Jun 22/18, Down 31%) He still likes this. This is beautiful technology. They are actually a miner. His strategy is to have this at 2.5% of his portfolio, so has continually added as the price has come down. He has not lost faith in this, just thinks it is early.
(A Top Pick Apr 03/18, Down 42%) The world's biggest ethereum (cryptocurrency) miner. He's been increasing his position since December when the price was very low. Well-managed. He likes etherium and bitcoin. Blockchain is rebounding since December.
Blockchain ETFs? He loves block chain and has about 7% of his portfolio. He likes HIVE as they are a miner of block chain coins. Global integration is just getting going. The technology will benefit from the way global markets will go forward. Imagine if gold could have a tracking system for physical it would do wonders for the control of its movement. He thinks this will happen with block chain technology.
Higher risk. Recently pulled back, as have all speculative names. If you have a high risk tolerance, make it a core position and trade around that. If you have a long time horizon, you can buy and hold. Longer term, he sees increased adoption and higher bitcoin prices. Short term, share prices will move around a lot.
The upshot: BITF, HUT and HIVE all outperform Bitcoin itself, but suffer more volatility than its base currency. The miners' fortunes are intrinsically tied to the fluctuations of Bitcoin. The main costs for these miners start with the capital costs (an army of supercomputers) and the real estate where they operate day and night. An ongoing cost is electricity, since these machines are energy hogs. ESG investors should investigate how much energy is derived from renewables.
As for where Bitcoin is going, that's like asking where gold is heading. Both are “safe haven” investments which rally when investors feel uncertain. Having this correlation seems to be breaking down as vaccinations are pointing to reopenings around the world and will fuel economic recovery. Will Bitcoin plunge again?
Buyer beware.
Does not own stock of company, as unsure what cryptocurrency future is.
If crypto prices remain strong, will be good for company.
Hard to value company.
Like a Mini-Me Coinbase. He's traded this, on relatively small positions in separately managed accounts. Not in his fund. Good way to ride the wave of blockchain and cryptocurrency.
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Clearly has some problems. Slow, steady decline and volume’s dropping. Volatile stock. Be very wary. He’s not a believer of blockchain technology, it’s just a fancy database. Now a penny stock, so will be off the radar of many. If it can break above $1.70, might be more interesting.