A young investor, who was introduced to the cryptocurrency market at the age of 8 and is now 19, shares 3 investment strategies that teens should avoid.
Young investor start-up story
When Jack Rosenthal was 8 years old, his grandfather gifted him $5,000 to start an investment portfolio. On how he got into the investing business, Jack Rosenthal says:
He gave me a few shares to keep an eye on, but I was just a kid. I wanted to buy companies that I thought were cool, but it might not be good to buy based on measurements. Since then, I’ve listened to what he told me and started developing my own strategies.
As a teenager, while the other kids were playing sports or working part-time jobs, Rosenthal started an investment club at a local high school and other young people in the area brought in $1,000 to get started investing. Rosenthal explains:
In its third year, we had about 40 members. After the end of the third year, I really wanted to expand and make it as big as I could. And we increased it from 40 members to 90 members. This has made us the largest youth investment club in existence as far as I know.
After leaving the youth investment club to go to college, Rosenthal wanted to pass on everything she knew, especially since she felt it was important for the club to always have youth leadership. He self-published his book ‘Youth Investing’ on Amazon so that the club can learn from its experiences. At Kriptokoin.com we have prepared for our readers the strategies that Jack Rosenthal says young investors should watch out for in the cryptocurrency business.
Strategies that young investors should avoid in the cryptocurrency business
1. Investing in altcoins
Jack Rosenthal says altcoins are ‘too volatile’, making them a less than ideal investment option. He says that young people are more likely to fall prey to the hype of smaller altcoins, which is probably irreversible. The young investor explains his view as follows:
Apart from the leading cryptocurrency Bitcoin, in theory, smaller cryptocurrencies have not been proven to be here in the long run. Therefore, they may not necessarily make large long-term investments. That said, I think Bitcoin and Ethereum have a few advantages and I think they’re here to stay.
2. Waiting to diversify the portfolio
Too many young people think they should wait until they have more money to diversify their portfolios, according to Jack Rosenthal. “Depends on how much money the youngsters have,” Rosenthal comments. But I would advise young investors to be wary of putting all your money into one thing.
3. Investing in exaggerated stocks
“Obviously, it’s always impossible to predict the market,” says Rosenthal, noting that whenever something is really overrated, one should be very careful. Rosenthal says that a stock that explodes on Robinhood or is written about everywhere in the news probably means the price has already risen significantly, which means it’s a bad time to buy it. The young investor explains his views with the following statements:
When everyone tells you to buy, you don’t really buy at the best price. That’s why I hesitate to invest in such a summit.
