Do you want to start investing in the crypto space? Well, you are in the right place. Investing in cryptocurrencies is generally not recommended for conservative investors as the market is too volatile and the risk involved is relatively higher than other markets.
Almost every investment professional or trader you ask will advise you to build an investment strategy with a diversified portfolio. While portfolio diversification works in almost any type of investment, it is a lucrative way in the crypto market to protect funds from the high risks involved. These How to Invest in Crypto For Beginners.
Also Read: How to Get Bitcoin For Free Without Mining
How to Diversify Your Crypto Investment Portfolio?
20% to 40% in Top 10 Coins
Invest about a quarter of your funds in top coins like Bitcoin, Ethereum, XRP, Litecoin, etc. They are market-moving currencies whose prices often change rapidly and greatly. So, limit your investment in this coin to no more than 30%. You can check the coins on CoinMarketCap.
20-30% on Popular Altcoins
Altcoins are currencies created as an alternative to Bitcoin. Some of the popular ones include NEO, XLM (Stellar Lumens), Binance Coin (BNB), etc. Experts strongly believe that Altcoins are most likely to outperform Bitcoin and other established coins.
This is because they have a strong foundation along with great growth potential, such as profit structure, utility mechanism, etc.
There are many other similar Altcoins that have great potential. The risk with these coins is arguably minimal while the potential returns remain high in the long run. So, most of your investment is better off in assets like these.
How to Invest in Crypto With ICO and New Coins
There are more than 50 new cryptocurrencies launched every month. You can invest some of your funds in this new currency or ICO.
Again, instead of investing all the amount in a single coin or ICO, you should spread it back across different projects to substantially increase the chances of higher returns. But remember, keep reading (Whitepaper) how this project really is so you can judge for yourself its feasibility. Never invest in something you don’t know and always invest money that you can “throw away” with pleasure.
How to Invest in Crypto With Daily Trading
Day Trading is usually recommended for those looking for high returns in the short term. The catch is that you invest in a cryptocurrency and then sell it immediately (or hours later) once the price has moved up a few percent.
Highly volatile cryptocurrencies seem perfect for this type of trading. If you wish to day trade, be sure not to invest more than 5-15% of your entire portfolio, as the risk is very high in this market.
Other Tips for Maximizing the Return on Your Crypto Investment
- Keep updating your portfolio regularly, usually once a month or so,
- Investments in projects that can generate returns in the short to medium term,
- If you trust Altcoins, feel free to keep your funds for a longer period of time,
- Focus on big wins,
- Take advantage wherever you can.
The main strategy for crypto investing is to be wise in project analysis and selection. The crypto market is still very uncertain, and there are more bad projects than good ones. A thorough analysis of a coin (project) before you invest in it is very important for the lifetime of your investment. Don’t stop learning!
Also Read: How To Mine Bitcoin On Android Phone
Disclaimer: This article is only the point of view of the author and the author is not a financial advisor. Crypto daily, affiliates, writers, employees, subcontractors are investors from time to time and may not have cryptocurrencies written about. You should do a more detailed check before investing in the Bitcoin or cryptocurrency market.