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Hey Friend,
There’s one thing about this bull run that honestly freaks me out.
I’ve been seeing more and more gurus talk about borrowing against your assets lately.
If you're thinking about borrowing against assets, I'm teaching how to do it safely at my upcoming live event. Reserve your seat here.
During the last bull market cycle, that wasn't the case. Almost nobody was talking about it, and there were nowhere near as many borrowing options as today.
Now it’s easy. Right on the home page of your Coinbase app it shows you how much you can borrow with the tap of a button.
Borrowing is the easy part, I don’t hear anybody talking about how to do it safely.
Here are four things you need to understand first...
1. Calculate your safe LTV
LTV means loan-to-value. What percentage of the asset you’re going to borrow.
Do NOT borrow how much you need.
Borrow how much you can safely manage.
You need to do the math.
2. Stress-test every scenario
Don’t borrow and cross your fingers. You have to know ahead of time what you’re going to do if it drops 20%, 40%, 60%, etc.
Can you withstand the worst case scenario or will you get margin called?
You’ve heard me say it before, you have to make sure you never become a forced seller.
You have to be able to hold on long enough for the asset to recover and you don’t get shaken out.
3. Know exactly where the payments will come from
The #1 question people ask me is, "But how am I going to make the payments?"
That question assumes they don’t have any income.
Why wouldn’t they?
The goal isn’t to take out max LTV, quit your job, and sit on a beach.
The goal is to accelerate your growth. But you should still have income.
If not, there are creative ways to engineer it into the loan.
4. Build your liquidity layers
If you do get margin called, you need to know where to get the funds.
A while back someone commented on one of my posts that he got wiped out and a friend spotted him $50k in BTC to weather the storm.
He didn’t realize it but his friend was one of his “liquidity layers.” If he would have built his own layers ahead of time, his friend wouldn’t have had to bail him out, and he would have saved himself a ton of pain.
I recently hired a new coach for my program who has worked for several financial companies and he said our 4 liquidity layers strategy is worth the price of the entire program on its own.
And next Thursday, I'm going to teach it for free.
If you want to learn how to safely borrow against assets without turning one bad drawdown into a financial disaster, you do not want to miss this live event.
REGISTER HERE.
You can increase your upside while minimizing your downside at the same time. You just have to learn how to do it. I’ll show you how.
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