With the right approach, a Crypto Currency can make you a millionaire. Here’s a great example of such a story.
Miles Black is co-founder of Pure Investments. For a while he postponed 10% of his salary and in May 2017 he started playing on the market for a thousand dollars. Today his portfolio is worth 46 thousand dollars, that is, in less than a year it has increased 46 times.
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A similar story (only on a different scale) occurred with one of the first clients of Pure Investments, known as SP. He started trading in September 2017 with 40 thousand dollars in his pocket, and by January 2018 he had already had more than a million dollars (today it is about 800 thousand dollars, because the rate ofrecently fell).
Yes, the crypto-Currency markets are very volatile, but if we behave correctly, each of us can limit possible losses and maximize . So, here are the nine main rules of cryptotrading.
Please note that this is not an investment advice. By investing money, you act at your own peril and risk.
1. Invest only what you can afford to lose
During the recent collapse of the course, amateur investors lost a lot of money. And, judging by the stories, to the financial losses of many added broken monitors and laptops. Remember that this is the most important rule: once you converted money into crypto currency, consider that you lost it – there is absolutely no guarantee that you will be able to return them. Moreover, scenarios can be very different: they are losses due to the fall of the market, and burglaries, and errors in the software, and government intervention.
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If you invest money that you can not afford to lose, think carefully – you can not do this. And it’s not just about crypto-currencies – it’s about using credit cards, getting, and wanting to sell everything and go traveling (although it sounds attractive, of course).
2. Always watch what happens to bitcoin
Most crypto currencies are tied to bitcoin (Bitcoin) more than Asian currencies to the dollar during the Asian financial crisis. If the cost of bitcoin starts to grow, the price of any crypto currency may fall, as people sell them to buy bitcoin. If the bitcoine rate, on the contrary, drops sharply, other crypto-currencies may also become cheaper, as people go out of them into fiat money. The best period for alternative crypto currency is when bitcoin is gradually becoming more expensive or cheaper, or is standing still.
3. Never put all your eggs in one basket – diversify your investment
Yes, the more you put money into those or other tokens, the higher the potential profit, but higher and possible losses. You can also consider the crypto currency market as a whole: if you consider this direction to be promising, then you can proceed from the assumption that the totalall crypto-currencies will grow. What are the chances that this growth will be triggered by a single crypto currency, not by a set? Small, and therefore to win from this recovery, it is better to have a diversified portfolio.
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It can be recalled that during the period from January 2016 to January 2018 Corgicoin grew by 60 thousand times, and Verge – by 13 thousand times; During the same period, bitcoin rose 34 times. If you had invested only in bitcoins, you would have earned quite well, but including other tokens in the portfolio could have brought much more profit.
4. Do not be greedy, fix profits
Yes, when this or that crypto currency starts to grow, our greed grows with it, but if growth has exceeded 30%, why not fix the profit? Even if you set a goal of 40% or 50%, you can take at least part of the profit in case the goal is not achieved. If you wait too long, you can lose what you already earned, or even stay at a loss, so make it a rule to take profits and continue to make a new call if the situation seems promising.
5. Do not Invest Blindly
There are a lot of people who will go for everything for the sake of profit. And, of course, playing on the crypto currency market, they use every opportunity to cash in at the expense of less informed investors.They will loudly talk about the advantages of a currency – just to inflate prices and come out with a profit.
Today, because of the speculative nature of the crypto-currency markets, the investor must independently analyze the situation, since no one can take responsibility for his investments for him.Even the information received from a very good and famous investor is just information, but not insurance against failure.
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6. Do not be afraid to miss something important
The December growth of bitcoin from $ 10,000 to $ 20,000 was largely due to this fear – and is generously flavored with media advertising andannouncements on the CME and CBOE exchanges. Since then, bitcoin has managed to fall below the same $ 10,000 for a coin, and now it costs about 11 thousand dollars.
Now it’s easy to say: “If I waited just a month, I could buy 9 thousand, and now I need to wait 20 thousand to just return the enclosed.” Why did people buy bitcoin for 20 thousand dollars? Probably because of a combination of greed, lack of awareness and fear of missing the wave.
But even in a crazy world, if you see rapid growth, you can be sure that correction will follow, it’s only a matter of time, because a speculative bubble almost always follows a collapse. Trying to jump into a train at full speed to face only James Bond, and most of us should take care of the health and just wait for the staff at the nearest stop.
7. Break investments into categories and analyze the full picture of what is happening
Studying various crypto currency you will inevitably come to the conclusion that they can be attributed to different categories. About some you will understand that behind them is a good team, excellent vision, stunning advertising and a respectable track record. Excellent! Take them to medium or long term investments and allow them to mature. If the price starts to fall, do not even think of selling – this is the meaning of the game for a long time. For example, Binance Coin (BNB) is a good candidate for such an investment. Recently, this currency has fallen in price by 20%, and many have started selling their assets, but within a week the rate has tripled for a while.
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8. Always learn from your mistakes
Never consider failure to be final, always evaluate the situation and try to find out why this happened, and let this experience help you in the next step – this time the results will be better as you become more experienced. Everyone starts out as an amateur, and with everythere are regular losses.For example, after the first month of trading, Miles had only three hundred out of a thousand dollars.
Nobody is perfect, and there is no genius who earns on every transaction. Do not let the losses confuse you – thanks to them you become more professional, if, of course, learn from your mistakes.
9. If you are an active trader, use stop-loss
Use stop-loss for any coins that are not related to medium and long-term investments. This is important for several reasons: first, so you limit possible losses, but, more importantly, when choosing the stop-loss trigger, you are forced to make a decision about the level of acceptable losses and get a benchmark that allows you to measure efficiency, and, accordingly, take into account her in future transactions.
In addition, sometimes, when the market goes down, alternative crypto-currencies can fall particularly sharply, and then automatic sales when stop-loss triggers can come in handy as you get the resources to enter the market at a lower price.
Bonus: Always check thecryptocurrency
The fact is that tickers are not universal and can sometimes vary from stock exchange to exchange, and this can cause losses. For example, Bitcoin Cash on some exchanges is traded as BCH, and on others as BCC. BCC is also a ticker for the BitConnect token, which was recently exposed as fraudulent. So, if you bought a BCC, thinking you were buying Bitcoin Cash, you would have lost a lot of money.
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