To make cryptocurrency investment portfolio — not a matter of minutes, although many investors are attracted by the wave of the ICO and growth of the cryptocurrency market, want to earn as quickly as possible. However, the abundance of opportunities means that it is better to spend time and understand the market.
This is the new Wild West, just changed a little of the scenery, and now the cowboys programmers ride horses-programs in search of digital gold. If you don’t want to miss the chance, it is better to arm themselves.
So, let’s consider the key points that should be considered in compiling cryptocurrency portfolio.
1. Bitcoin — the new standard
The granddaddy of all cryptocurrency earned the title, because bitcoin bull market of the past years was the result of the emergence of a whole new market based on this cryptocurrency.
So it’s not surprising that bitcoin is sometimes referred to as digital gold when investors get nervous, they are traditionally buying gold, but for cryptocurrency investors the role played by bitcoin.
- It was never hacked.
- It is widely available and well supported on cryptocurrency exchanges around the world.
- It is the most liquid cryptocurrency (it is easy to find a buyer or seller).
- A more modest cryptocurrencies give a lower return than bitcoin, and they are hard to trade. Ask yourself whether to buy a not too well known coin? In many cases, in the long term, enough to buy a bitcoin and wait a few years.
2. It is important to understand what risks you are willing
We are dealing with risks, both in life and on the market. At the same time to invest in cryptocurrency means to deal with huge volatility, and this requires strong nerves.
It is very important to ask yourself a few questions related to cryptocurrency risks, and record the answers:
- How much to invest?
- The amount of money you can lose?
- What are your investment objectives?
- How far you retire?
There is a convenient system for assessing risk tolerance: check whether you are sleeping at night. If you find that you think all the time about the prices and get up in the night to check the status of the portfolio, you’ve probably invested too much — never invest money that you can afford to lose!
You may want to hire a financial consultant that he did everything for you, but keep in mind that in this young industry accredited specialists almost never occur.
3. You need to understand everything yourself
Probably the worst thing you can do, deciding to invest in cryptocurrencies, is to invest impulsively, on hearing someone else’s advice — it’s your money, not someone else’s!
In our time information is available as never before and, of course, there are both pros and cons. On the Internet a lot of information easy to find, but difficult to interpret. However, a smart investor should do the job.
Each project is trying to put themselves in the best light, and though no perfect companies, many of them are outright frauds. Study expert opinions — Twitter is a great accounts that regularly give out some useful information.
4. Responsibility for your decisions rests with you
Now that you have done this, it’s time to add to the portfolio of selected coins and face the consequences, because you are solely responsible for all his investment decisions, both good and bad. It will make you a good investor.
Don’t be deceived by the speeches of those who say that never loses — bad decisions even the best of the best, the way of the market. By taking responsibility for your mistakes, you learn is the only way to get better.
Not one word of this note cannot be considered as investment advice. You have probably met such a formulation, it is not surprising — nobody wants to give investment advice. Why? Because many investors lost money, want to shift the blame to someone else. Don’t be like them.
5. You need to be patient
When we see double-digit growth in a bull market, it’s hard not to zametalsya from one asset to another, but that is just what and not to do — be patient, play out in the long term, and the market anywhere you are not going anywhere.
If you can’t call yourself talented and active intraday trader, better buy and hold is a two — digit loss are better tolerated when you see the chart for a few years.
Remember that no one gives a guarantee. You can look at it this way: patience is one of your many tools. Yes, if the coin depreciates to zero, it does not pay off, but patience is an important value because it makes you a better investor.