Market downtrend, wiping up all the gains?

Market downtrend, wiping up all the gains?

With Bitcoin touching the below USD 90,000 mark, Indian Sensex is also dipping from it's all-time high of 85978.25 points to the current 74000 points, suddenly everything started looking gloomy. Out of all the reason and plausible theory, it point out to the policy of the Fed regarding rate cut and launch of the AI model deepseek. (No idea why there is an always Chinese connection for crashing stock markets, earlier it was Covid, now deepseek and both are so unrelated to each other as one is virus while other one is an AI.)

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I just thought that it might be the time to check if the investment made a year earlier is still a profitable investment with all the dips in the markets. So I decided to check the investment profits against the crypto, Gold, and the stock market.

Bitcoin is still high.

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Bitcoin touched it's peak at $108K at Jan 2025 and at its current price it is trading below at 18% but if it is compared to the last year market price at same time it is almost up by 63% as it was trading around $54K. So if you have investment around a year old, I guess you are still having very healthy profits despite it is trading 18% low from it's high.

Gold is slow and steady.

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The Gold chart looks impressive with Gold climbing up every month, Overall gain for a year comes to around 44.38% which is definitely less than Bitcoin percentage gain of more than 60% but Gold chart is almost steadily climbing it means that you are in gaining in Gold at current prices irrespective of the month of year, you have entered in the Gold market. In my view, Gold investors got the least anxiety and steady gains throughout the year.

Indian Sensex almost lost all gains.

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Sensex/Stock market is the worst hit, though it is showing marginal gain of 2.49% overall but in the year 2025 many stocks created low that was well below the low of the year 2024 and it marks the negative return on the principal. Though I do not have data that how many users are actively trading now but I guess it certainly reduced. I have a long travel route for to and fro from work and I use public transportation and I personally witnessed people now seeing movies, playing games and browsing social media sites and earlier they used to visit stock trading app and social media sites.

Here is the reason to diversify.

If someone has invested $100 in all of these three investment tool, than overall profit from Bitcoin will be $63, from Gold it will $44 and $2.5 from stocks. So it will be around $109.5 profits for $300 invested and overall it marked a 36.5% return it is a very healthy return.

At current, stock market is so much in discount that it does not look like a good choice but when I go back further to the Covid period, I saw some good stocks just doubled from their price in 3 year period and almost become 3x when compared to their low in Covid to their high in 2024 and may be in next 2-3 years they are again going to be 2x of their current low of 2025.

So in all, diversified and long-term investment has much better potential to beat the market downtrends and may still show you positive gains even in the downtrends.

Posted Using INLEO