We’re in the business of managing risk. Getting as much return as we can without putting funds at existential risk.

The Bitcoin price soared over 100% this past year. People were asking about it. Then, in the past few weeks, it has fallen sharply.

Having worked for the world’s first regulated Bitcoin fund in Europe in 2016, I am familiar with the asset class. When we invested back then, we thought it would become a means of exchange. It has actually become a form of digital gold.

This means its primary value is really in its capped supply. Not necessarily in its business case.

Personally, I’d rather be invested in a productive business that grows on the basis of its revenue and the value of its tangible assets. This is a more risk-managed strategy.

I well remember in 2021 when Bitcoin reached $64,000, and then fell to $16,000 within a year.

Of course, savvy traders could well make superb gains by being in and out at the right time.

But that’s not a long-term value strategy to build wealth and income.

 

Source: AI image by Freepik

 

My recent trip to Italy confirmed something. A valuable, undiscovered business sitting at a deep discount will eventually be discovered by the market.

In fact, I can point to 10 listed businesses on the Milan exchange that have grown from 100% to 1,000% in their stock price over the past year. Some are large companies. Some pay decent dividends. They were simply overlooked by investors because they were in a country with rocky government and high debt.

Well, those fears were overblown. Italian household debt is relatively very low, providing the economy a bedrock against government borrowing. The recent Meloni administration has brought stability and some of the best economic growth in Western Europe.

My deep observation of Italian business is that the quality of production and service is often excellent and understated.

So, let us take a look at a Milan listed businesses that has been beyond the radar. It is not an AI or software businesses at sky-high P/E multiples built on some ephemeral promise. Instead, it produces real and sophisticated products experiencing growing global demand.

 

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