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Cryptocurrency is a decentralized, digital medium of exchange that is based on blockchain technology. Nothing like the U.S. Dollar, Yen, or any other traditional form of currency, there is no central authority that controls the value of cryptocurrency, which has not only led many popular figures in the finance world to be skeptical about it but also caused an abundance of investors to demand cryptocurrencies more and more as time goes on.
Stocks in the cryptocurrency sector, similar to cryptocurrencies, have broadly outperformed the S&P 500. For example, Riot Blockchain (NASDAQ: RIOT) has had a 657% return, while Bitcoin has accumulated approximately a 400% return over the past year. On the other hand, the S&P 500 has had a 23.88% return in the last 52 weeks.
Here are the cryptocurrency stocks with the largest total amount in Bitcoin holdings right now.
Overview: Crypto Stocks
More investors are turning to cryptocurrency stocks as a safer route to enjoy the long-term upside from cryptocurrencies without exposing their portfolios to the volatility of individual cryptocurrencies. Some of these stocks include players in the semiconductor, payments and brokerage companies that have exposure to the cryptocurrency value chain.
Best Online Brokers for Crypto Stocks
If you’re looking to buy or trade crypto stocks, you can do so online from the comfort of your home. Yes, it’s that easy. All you need is a broker. With so many different options to choose from, we have researched and compiled a list of some of the best brokers out there.
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
- Active traders
- Intermediate traders
- Advanced traders
- No account maintenance fees or software platform fees
- No charges to open and maintain an account
- Intuitive trading platform with technical and fundamental analysis tools
- Does not support trading in mutual funds, bonds or OTC stocks
Moomoo is a commission-free mobile trading app available on Apple, Google and Windows devices. A subsidiary of Futu Holdings Ltd., it’s backed by venture capital affiliates of Matrix, Sequoia, and Tencent (NASDAQ: FUTU). Securities offered by Futu Inc., regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Moomoo is another great alternative for Robinhood. This is an outstanding trading platform if you want to dive deep into smart trading. It offers impressive trading tools and opportunities for both new and advanced traders, including advanced charting, pre and post-market trading, international trading, research and analysis tools, and most popular of all, free Level 2 quotes.
Get started right away by downloading Moomoo to your phone, tablet or another mobile device.
- Cost-conscious traders
- Active and Advanced traders
- Over 8,000 different stocks that can be sold short
- Access trading and quotes in pre-market (4 a.m. to 9:30 a.m. ET) and post-market hours (4 p.m. to 8 p.m. ET)
- No minimum deposit to open an account.
- No chat support
E*TRADE is an online discount trading house that offers brokerage and banking services to individuals and businesses. One of the first brokers to embrace online trading, E*TRADE not only survived both the dot-com bubble and Recession — it thrived. You can choose from two different platforms (one basic, one advanced). E*TRADE is a suitable broker for traders of most skill levels, whether you want to buy mutual funds and hold them for decades or dabble in options swing trading. E*TRADE offers a library of research and education materials to help you out.
- Active traders
- Derivatives traders
- Retirement savers
- Sophisticated trading platforms
- Wide range of tradable assets
- Exceptional customer service
- Limited currency trading
- Higher margin rates than competitors
- No paper trading on its standard platform
This latest groundbreaking technology is IBKR GlobalAnalyst, a new trading tool that helps investors compare the rate of PEG or price-earnings growth valuations and provide more immediate and comprehensive financial metrics of stocks, globally.
Recognizing that stock selection can be challenging for investors to compare the valuations of domestic and international stocks, Interactive Brokers created GlobalAnalyst to offer investors a simple, yet powerful tool to easily evaluate investment opportunities around the world.
Using GlobalAnalyst, investors can search for stocks by region, country, industry, market capitalization and currency to uncover undervalued stocks worldwide. The resulting table displays the current market and financial metrics, including the PEG Ratio. The PEG Ratio is the PE ratio divided by the three-year compound earnings growth rate, and smaller PEG Ratios typically indicate undervalued companies.
- Price earnings growth valuations
- Easily evaluate investment opportunities
CenterPoint Securities is ideal for active traders who demand access to advanced tools and services. While investors and casual traders are likely to be content with the basic offerings of traditional online brokerages, active traders will benefit from CenterPoint’s suite of advanced trading tools. If you value execution quality, access to short inventory, advanced trading platforms, and accessible customer service, CenterPoint is an excellent choice.
- Intermediate to Advanced traders
- High-volume traders
- Momentum traders
- Short sellers
- Unrivaled access to short inventory
- Flexible order routing for improved executions
- Discounts for active traders
- Advanced platform with fast executions
- Reliable customer service
- Not designed for beginner or low-volume traders
Features to Look for in Crypto Stock
- Earnings growth pattern
Look at trends in earnings growth. Do the company’s earnings increase over time? It’s okay to buy a crypto stock because of its perceived value or future growth prospects. Still, if the earnings do not increase even slightly over a long period, this can spell doom for an investor. You can use the ratio of earnings per share to calculate the profitability of the stock. Earnings per share are calculated by dividing the company’s net income by its total number of outstanding shares. Companies with higher earnings per share have better profitability over time.
How well do you trust the leadership of the company? Before buying any stock, you must consider the people at the company’s helms of affairs. Effective leadership gives room for the kind of innovation, flexibility, and stability necessary for growth.
- Long-term strength and stability
The crypto market is generally volatile, and all assets at some point in time rise and dip. So what is most important is long-term strength and stability — look out for a company that can weather the storm and come out relatively strong. A stable company will most likely have effective leadership, low debt ratio and revenue growth.
Are Crypto Stocks a Good Investment?
The answer is yes. But you need to understand that some of these companies’ financial prospect and business performance is inherently tied to the price of cryptocurrencies, which is volatile.
The volatility of digital currencies may dim the outlook on some of these companies’ stocks. However, volatility of cryptocurrencies aside, investing in companies that enable the crypto ecosystems to function is a surer, more lucrative way to profit from the latest optimism on digital currencies.
The reason is that there are currently more than 2,000 different cryptocurrencies, and finding the next significant crypto asset might be a gamble. However, this shouldn’t be misconstrued as investment advice. You need to apply due diligence and seek expert opinion before making investment decisions.
If you’re looking for affordable stocks to add to your investment portfolio, the stock market has become more accessible with respect to the price required to buy a unit of a company’s share. As such, an average person with $5 can buy some company’s shares. Strictly speaking, there are stocks selling under $20, $10 and $5, which might turn out to be a reasonable add-on to your investment portfolio.