Are falling prices a cause for concern? Jan Beckers has a clear opinion on this: “Setbacks on the stock exchange are opportunities,” says the start-up investor, well-known in Berlin and runs his fund boutique with BIT Capital – short for Berlin Investment Technology. What sounds like a slogan for his investors to persevere is seriously meant. According to Becker, buying a successful company at a low price is an excellent way to make money. With his start-up factory Hitfox, which he renamed Ioniq Group in 2019, Becker’s founded more than 25 companies that are said to be worth several billion euros today. A better-known one is the Solarisbank. Becker now also manages the money he earned as a founder in his fund. If you’re interested in learning more about bitcoin trading, go to bitcoin millionaire pro for a complete guide.
Some investors may be less relaxed. The prices of many technology stocks and tech stock funds, including the value of Becker’s flagship fund BIT Global Internet Leaders 30, fell alarmingly quickly in January. First, the US Federal Reserve shocked investors with the prospect of rising interest rates soon. Then the Ukraine crisis came to a head. It didn’t help much that the Chinese central bank lowered its interest rates slightly. The US sets the tone.
As a result, many technology stocks have investors waiting for earnings. This prospect, coupled with high stock market valuations for some companies, makes tech stocks less attractive.
In the BIT Capital Global Internet Leaders 30, he and his investors achieved an increase in value of 333 per cent from the beginning of 2019 to the end of 2021. That’s where the recent decline comes in. The BIT fund is the top performer among technology funds. In doing so, Beckers even beat the fund professionals of the giants BlackRock, Fidelity, and Franklin Templeton, who are based in the tech stronghold of Silicon Valley.
Top performance is not enough.
But that’s not enough for one of the top places in the WirtschaftsWoche ranking of technology stock funds. Here it is not simply the money manager with the highest return that wins. If you want to be in the first place, you have to keep the losses in the crash low – and the price fluctuations.
Best in class is the BlackRock World Technology. With a 189 per cent increase in value, it is not the high-flyer, but fund manager Tony Kim can compensate for this with low price fluctuations and a relatively low maximum loss in 2019 to 2021 ( see table below ). It is currently being shown how vital risk prevention of this kind is.
In the multi-billion dollar funds of BlackRock, Fidelity, and BNP Paribas, the top ten often include well-known names such as Apple, Microsoft, Google’s mother company Alphabet and Amazon. But they make up a large part of the portfolio of Becker’s fund. The BIT Capital Global Internet Leaders 30 only came in 25th in the ranking. A fund from the lower ranks can be worthwhile for investors with solid nerves if the return and the strategy are correct.
In the past year, the technology areas were still doing well overall. Information technology stocks were up 40 per cent, communications were up 23 per cent, and internet and mail order distribution was 21 per cent. US star investor Cathie Wood was still admired for her ARK Innovation ETF, which rushed from record to record in 2020. In addition, numerous new funds came onto the market, occupying every niche from artificial intelligence to robotics. In September, tech investor Frank Thelen, known from the Vox show “Lion’s Cave,” launched his 10XDNA Disruptive Innovation equity fund.
Thelen’s timing couldn’t have been worse. Under the shiny surface, things were already going badly from February 2021. Only a few large tech stocks drove prices in 2021. Without Microsoft, Apple, Amazon, Meta (formerly Facebook), NVidia, and Alphabet, the US stock index Nasdaq 100 would not have achieved a plus of 21 per cent, but a minus of seven.
In January 2022, the party mood finally evaporated. Investors were suddenly deterred by exaggerations that they had previously accepted. The Bitcoin course lost 50 presents from the high. Many jumped at the chance to secure profits accumulated over the years. The fear of a significant crash resonated as it did after the turn of the millennium. It then took the Nasdaq 100 around 14 years to make up for losses.