GB Portfolio – Looking for Alpha? How about Theta

Overview:

As the market is turning, we are looking for some coins that have lagged the market but still offer a good reward to risk ratio.   Other than a handful of coins, once we are able to remove capital we will remove our capital and be in the position risk free.

There are two common faults in humans that are obstacles in making money.  Fear and Greed.  We do not want to get greedy, we are just looking to make some money.  This is why we have a strategy and plan for every investment and we stick to the plan.

Theta:

We mentioned Theta on our Podcast and it is a coin one of our subscribers asked our opinion on.  To be clear we are not sure how any of these platforms will evolve in the future, some will be adopted, others to the crap coin junk yard.

Theta is a project aimed at a decentralized video streaming and delivery network.  Yes another ERC20  coin aimed at bumping You Tube and Facebook off the map.  Normally I would be very skeptical however the Co-Founder of Theta, Steve Chen, was one of the Co-Founders of You Tube.  That got my attention.  In addition they have a solid advisory committee, as well as some heavyweight players like Sony and Samsung that our listed as investors.  

Theta aims to solve the “last mile” delivery problem for streaming video, which is a problem at high resolution rates.  Essentially allowing viewers to share redundant computing and bandwidth resources.  This in return would form a video delivery mesh network allowing video to stream anywhere in the world yet, being optimized for the local delivery.

Essentially in lieu of Google or Facebook setting up Point of Presence (POP) data centers to deliver content, a network of computers would be used and those sharing resources would be paid in Theta.  This makes a lot of sense to a company like Sony and Samsung to be involved as smart TV’s and streaming content are replacing cable.  This does not imply they will use it, they may be more interested in the technology.

The downside:

What is to stop Facebook or Google from releasing a FB or Googly coin and do the same thing?  Nothing, and they already have hundreds of millions of users that can free up resources.  Essentially this is likely the road we go down.  The other challenge with a decentralized network, content may not be banned.

This again is a double edged sword.  On the positive side, censorship of ideas would be less likely.  The negative side is that there is nothing stopping criminal activity from being streamed live.  

We recommend before investing in any coin you do your homework and see if it fits your risk appetite.  You can read the white paper here, and you should always do your own research.

Theta Chart:

While the rest of the market is in full rally mode, Theta has been in a tight consolidation area over the past week.  The 0.105 is the 61.8% retrace of the overall bullish swing, which was a prelude runup to them launching their mainnet.  This is a POS token so it is possible to stake your coins as a miner and obtain a reward.  Resistance levels are shown and our target level is the 61.8% extension of the bullish swing.  Technically 35 cents would be the next target, and those with a more aggressive appetite could hold out for a broader move.  Personally I like to take the money and run.  Selling at 21 cents provides an opportunity to buy the dip with capital removed, slowly building up a larger position.

You do not need to start with a huge amount of capital to slowly build up a position.  Smaller is better, as you are risking less, and can always add on pullbacks.

Strategy & Plan:

We are going to buy $150 worth of Theta here and if it pulls back to 0.08 or lower, we will look at adding to our position.  At 21 cents we will close out half our position, removing our initial capital and essentially be in our remaining tokens at no risk.

One issue with most traders during the epic run in 2017, is they never took their initial capital off the table.  Whether Theta succeeds or not only time will tell.  We have no control over this, the only control we do have is making rational decision.  Do not get greedy, take the money when you can, not when you must.  Allocate capital wisely, we are not looking at being overly exposed to tokens like this.

 

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