Cryptocurrency might be one of the riskier assets that you could ever invest in, and that’s while fully knowing that investing already has risks in the first place.
Cryptocurrency’s value is too volatile and passes by too quickly for you to ever gain anything. It’ll be like seeing something at the corner of your eye instead of getting to witness the full beauty, meaning you’ll need to keep watching the cryptocurrency market before you could even do anything.
That doesn’t mean that investing in cryptocurrency isn’t all that bad, albeit pretty risky. You just need to be more prepared, more knowledgeable, and you should always have several aces up your sleeve. So here are five tips to improve your cryptocurrency investing.
1. Invest With What You Know You Can Lose
The number one rule you should never forget when investing(not just into cryptocurrency) is that you should never use the money you can’t afford to lose in investing. This is usually not stated on many crypto exchanges. However, some like Immediate Edge do you the favour of reminding you. This is not only valuable information for you but it is also solid proof for how trustworthy the given platform is. If you invest with important money, then you’re going to feel devastated when your investment goes south. So when you do invest with money you can afford to lose, you’ll be more confident with your investment.
2. Prioritise the Strongest Cryptocurrency
Suppose you’re in possession of the strongest cryptocurrency. In that case, you’re going to be directly competing with all of the other cryptocurrencies – every single of the 10,000+! Bitcoin is currently the strongest, with over 50% dominance of the cryptocurrency market, so other cryptocurrencies aim to swipe the #1 spot off of bitcoin. So when investing in cryptocurrency, you should always prioritise Bitcoin above all else.
3. Keep Your Cryptocurrency Portfolio Diverse and Healthy
Although we did say to prioritise the most powerful cryptocurrency, we didn’t say that you should only ever go for Bitcoin. It would be best if you also tried going for the other coins. They could be giving you more profit with fewer losses. Just because the entire cryptocurrency market seems very volatile, you’re not going to see all of them drop at the same time. Therefore, you should ratio your investing money 7:3, Bitcoin to altcoins, respectively.
4. Get Your Emotions Under Control
Especially when handling money and risking it, you’re probably going to be influenced by what your emotions are telling you to go for. Fear will be your number one emotion that drives you away from making the better decisions and more into the incorrect ones. Excitement will be another emotion that will drive you to make poor decisions if you’re too caught up in the moment. Greed is something you should be avoiding and something you should limit at all times.
Avoiding the hype is also something that you should always keep in mind. When there are new changes in the market, make sure that you should analyse them well. The change may be temporary and might not benefit you in the end. Most of the time, there are new investors in the crypto market who have not done a thorough research and invested right away, and most of them turned out to have been unsuccessful. So, controlling your emotions when investing in something you should keep in mind at all times.
5. Always Have A Plan
Although it sounds like common sense to have a plan when investing in something, not many people do it. They don’t want to spend a little effort to create a plan and just dive straight into the cryptocurrency world. However, you should always have boundaries, limits, goals, and a means to achieve those goals. A plan will help you make better and more precise decisions.
Conclusion
You should consider that day trading and investing are art forms that would be easy to get into but hard to master. It’s at the last part of the article. Still, it’s the most important if you’re going into cryptocurrency investing to achieve something. Always make a plan, and if that doesn’t work, then have a backup plan. Now that you have read the tips, it’s about time that you start an investment in cryptocurrency.