The Capitalist Investor - Episode 113

If the Rams win the Super Bowl this Sunday, will Odell Beckham Jr. convert his Super Bowl bonus into Bitcoin? What will Tom Brady do after retiring from 30 years of football? With average ticket prices around $10,000, Brady could buy over half of the Super Bowl seats with just a fraction of his total net worth –– of course if he misses it that much already. This week, Derek, Luke, and Tony talk plays and strategies: the risks that come along with Bitcoin, investing after retirement, the game plan before entering the market, and how every investor has to be prepared to cut their losses. Episode #113 of “The Capitalist Investor” gives the full rundown of all the X’s and O’s that every investor should keep in their back pocket.

Outline of this Episode:

  • [5:15] OBJ’s run with Bitcoin
  • [11:00] Just accept what the market gives you
  • [20:10] What will Tom Brady do now?
  • [26:05] What do sports and stocks have in common? Competition

Don’t be fooled, OBJ’s Bitcoin is still valued by the dollar

After OBJ got cut from Cleveland, he was signed by the LA Rams for the rest of the season with a $750,000 salary. He then took that salary and converted it to Bitcoin. What could go wrong?

First, there was a misconception that the Rams paid OBJ in Bitcoin or that he decided he wanted it in Bitcoin. That is not how it worked and it would be a completely different story if the NFL was distributing Bitcoin through its payroll.

OBJ converted his salary into Bitcoin on his own discretion and there’s a lot of angles he could’ve taken with it. But the biggest thing that stands out is that like other cryptocurrencies, Bitcoin fell significantly at the beginning of the year and there’s no doubt that Beckham is experiencing some consequences from the risk he took.

While Beckham is not the only player to convert his salary into Bitcoin –– he might be the cautionary tale. Yes, it’s admirable that celebrities are partaking in this world and its possibilities while encouraging others to do so, too. But to be honest, the average person cannot take those same risks. Money is on the line and very few could afford to risk it that large.

Aside from the unnecessary risk, we’re just not ready to depend on Bitcoin yet. If you were to purchase Bitcoin, its value is still tied to the dollar. Sure, there will likely be a day where the dollar is replaced by some sort of cryptocurrency, but it’s not now.

If the Ram’s secure the win this Sunday, we’re wondering what OBJ’s next play will be: keep the bonus in its dollar form, or convert to more crypto?

The market is not always going to go your way –– have a plan

Two words: entry point. We live in a world where there are so many possibilities to make money and to make it quick. NFL players are turning their salaries into cryptocurrencies, pixels of art and JPEGs are now worth millions of dollars, there are hundreds, basically thousands of stock choices and practices to partake in. But what do all of these mean if you don’t do your research or have a plan? The most common answer is: trouble.

Every investment is different yet alike in the same way that they don’t just go straight up; they don’t immediately lead to success. We’re living in a time of short-term fluctuations which are expected in a highly volatile environment. If your strategy –– and especially your timing –– is wrong, and you experience a loss, you need to have a plan that will prevent you from holding onto that loss forever.

It’s all about entry point and when to make a play. The strategies and reasoning can support your move, but if you move in at the wrong time, you’re still wrong. There are new results every day, you constantly have to keep up with the changes and take in the information to make new decisions. So, just take what the market gives you and pivot. Be prepared to lose here and there but don’t dig yourself too deep to a point where you’re not climbing out of that loss. There’s no use in trying to control what the market gives, the only thing you can control is how you enter it and when you do it.

If you had $800 million at the end of your career, what would you do?

It’s in our human nature that we’re driven by competition. It’s what sports and stocks have in common –– competition, wins, losses, winners, and losers. But where does Tom Brady, unarguably one of the best football players of our time, come into this?

Tom Brady has always been good at winning on the field. But now that he’s done and retired, he and his wife together have accrued almost an $800 million net worth. How will he transform his wins and successes from a 30-year career into something new? What will he do?

There’s a line of people standing behind Brady, eager to pitch ideas and work with him so he can utilize that net worth. There’s no doubt that he’s going to be dipping into several ventures, hobbies, and businesses. He’s a competitor at heart and it’s possible his new game will be like the one we’re all competing in here: investing. A true competitor can never stay away from chasing wins and coming back from losses.

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Keep Listening to The Capitalist Investor:
Episode 15:
Spending Strategies in a Bear Market, Ep #15
Episode 31:
Handicapping the 2020 Election, Ep #31
Episode 47:
11 Investments in Your Home That Pay Off, Ep #47
Episode 63:
Jeff Bezos and Amazon: Past, Present, and Future Ep #63
Episode 79:
7 Ways Biden Plans to Tax American Families (Part II), Ep #79
Episode 95:
5 Beaten Down Stocks to Buy on the Dip, Ep #95
Episode 111:
Special Episode – Talking Energy with Daniel Turner, Ep. #111
Episode 127:
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