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Buy bitcoin directly

The first option is the most straightforward: If you want to buy Bitcoin, just buy Bitcoin.

These days, many platforms allow individual investors to buy and sell crypto. Just be aware that some exchanges charge up to 4% commission fees for each transaction. So look for investment apps that charge low or even no commissions.

While bitcoin commands a five-figure price tag today, there’s no need to buy a whole coin. Most exchanges allow you to start with as much money as you are willing to spend.

Read more: Earn extra cash for your weekend with these quick money hacks

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Bitcoin ETFs

Exchange-traded funds have risen in popularity in recent years. They trade on stock exchanges, so buying and selling them is very convenient. And now, investors can use them to get a piece of the bitcoin action, too.

For instance, ProShares Bitcoin Strategy ETF (BITO) started trading on NYSE Arca in October 2021, marking the first U.S. bitcoin-linked ETF on the market. The fund holds bitcoin futures contracts that trade on the Chicago Mercantile Exchange and has an expense ratio of 0.95%.

Investors can also consider the Valkyrie Bitcoin Strategy ETF (BTF), which made its debut a few days after BITO. This Nasdaq-listed ETF invests in bitcoin futures contracts and charges an expense ratio of 0.95%.

Bitcoin stocks

When companies tie some of their growth to the crypto market, their shares can often move in tandem with the coins.

First, there are bitcoin miners. The computing power doesn’t come cheap and energy costs can be substantial. But if the price of bitcoin goes up, miners like Riot Blockchain (RIOT) and Hut 8 Mining (HUT) are likely to receive increased attention from investors.

Then there are intermediaries like Coinbase Global (COIN) and PayPal (PYPL). When more people buy, sell and use crypto, these platforms stand to benefit.

Finally, there are companies that simply hold a lot of crypto on their balance sheets.

Case in point: enterprise software technologist MicroStrategy (MSTR). It has a market cap of under $3 billion. Yet its bitcoin count reached approximately 132,500 as of Dec. 27, 2022, a stockpile worth around $3.06 billion.

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Another Cuban favorite

Of course, bitcoin isn't the only alternative asset class that Cuban likes right now.

On Shark Tank late last year, the billionaire invested $225,000 in Wondry Wine, a North Texas wine business launched by husband and wife team Whitney and Chaz Gates.

As a real asset, fine wine can provide diversification to protect against the volatile effects of inflation and recession.

As of right now, the S&P 500 is down 6% over the past year. Meanwhile, the Liv-ex Fine Wine 1000 has gone up 22% over the same time period.

It offers plenty of growth, too. Since 2005, Sotheby’s Fine Wine Index has gone up 316%. Wine outperformed the Global Equity Index by 1.88% annually over the last 15 years.

You can invest in wine by purchasing individual bottles — but you’ll need a place to store them properly. Residential wine cellars often cost tens of thousands of dollars. If not stored at the right temperature or humidity, the bottle could be compromised.

That’s one of the reasons why investing in fine wine used to be an option only for the ultra-rich.

But with a new investing platform, you can invest in investment-grade wine too.

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About the Author

Jing Pan

Jing Pan

Investment Reporter

Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.

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Disclaimer

The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.