Crypto News: New investing ideas for a pessimistic era

From Wall Street to the crypto exchanges, bond markets to retail-trading platforms, the "vibe" in investing has undeniably shifted. It's gone from mania to miserable. And it looks like the dour markets, high inflation and persistent uncertainty aren't going away anytime soon. So much for my eternal optimism.

But smart investing is all about taming your biases. That's why, in this new (pessimistic) era, I'm happy to share with you our latest quarterly installment of the "Where to Invest" series. In it, six experts offer timely suggestions on where they would put $1 million right now. Even if you don't have $1 million to invest — you won't find it in my bank account — the themes discussed give investors at any price point some financial food for thought. (And stay tuned for upcoming editions, which include lower denominations such as $10,000 and $100,000.)

Three ideas struck me: municipal bonds, blockchain and cybersecurity.

First, Stephanie Larosiliere, a senior client portfolio manager at Invesco, points out that macro issues are throwing a bit of a "monkey wrench" into what she calls "the golden decade of municipal credit." But fundamentals and an extraordinary amount of funding from the federal government means she still sees a lot of upsides in munis, particularly for investors in high tax brackets seeking tax-exempt income.

Second, you've doubtless heard about crypto's massive wipeout of late. That's why I took note of the comments from Luis Berruga, chief executive officer of Global X ETFs, about the distinction between crypto and blockchain.

"Blockchain is fundamentally different from some of the cryptocurrencies we've seen. The case for blockchain as a technology I don't think has changed," he says, adding that he sees the recent drop in market prices as an opportunity for investors.

Third, if you want tech as part of your portfolio but are fearful of the recent rout, you'll be interested in Berruga's view on cybersecurity. Corporate cyber attacks are increasing in severity and frequency. Companies are desperate for new, more advanced tools, which could mean growth. Berruga sees the space growing by an average compounded annual growth rate of 24% through 2026.

Make what you will of these ideas and the others in the piece. And perhaps take this counterintuitive suggestion from Bloomberg Opinion's Jared Dillian: Try your hand at timing the market. Financial advisers always caution individual investors against doing this. But Dillian sees some advantages to trying it at least once or twice in your investing career. His argument? Be aware — and make use — of shifts in sentiment. Including your own. — Charlie Wells

Send us questions about your own financial dilemmas to bbgwealth@bloomberg.net.

These electric cars are quietly dominating the EV market.
Michael Burry warns the Fed may alter its course.
A $2 trillion free-fall has rattled crypto to the core.
Spotify's billion-dollar bet on podcasting has yet to pay off.
Putin is pushing Germany's economy to the breaking point.
Mortgage lenders are turning "desperate" amid soaring rates.
China asked foreign business leaders how to revive Hong Kong.

In Bloomberg Opinion this week, Lionel Laurent says the lights are going out for crypto's laser-eyed grifters:

There aren't many silver linings to be found in the cryptocurrency crash. People have lost money, often those who could least afford it. But one welcome casualty is the army of laser-eyed social media "influencers," toxic promoters in what must surely rank as the one of the most egregious product-placement manias in financial history. What comes next should be a healthier focus on consumer protection in an age of digital investing.
Read his full argument here.

With the way the world is going and the market going down, should I pull money from my 401(k) and investments? — Jen Fuller, 34, Raleigh, North Carolina

Jen, in the words of Schoolhouse Rock, embrace the message, "When you're walking on Wall Street, buy low, sell high, take a piece of the pie." Until recently, it's been easy to withstand minor market fluctuations, but now is the time to understand your risk tolerance. At 34, I suggest staying the course. When the market is down, you are buying more shares with every payroll contribution. If you're in a position to invest more, consider increasing your contribution, as you have the opportunity to buy more shares at a discount. While we cannot predict the future, if history repeats itself, this too shall pass. The strategy avoids the natural investor reaction to sell when the market is down and buy into the frenzy. Finally, make sure your portfolio is well diversified. Also, build a reserve fund and manage debt. Start early, save and minimize debt, and you will finish well.
— Darla Kashian, financial adviser, RBC Wealth Management

Send us questions about your own financial dilemmas to bbgwealth@bloomberg.net