Investing in cryptocurrencies: how, when and how much?
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During the anticipation of the New Year 2018 and immediately after it, we observed a strong drop in both Bitcoin and other cryptocurrencies in this new and large-scale market. In this connection, the question arises whether it is worth investing in this sphere? If it worth, then how much to invest? All this will be discussed in this article.
To start with, it is worth remembering that investing is always a relatively risky business. Investing in purchasing the cryptocurrency is even more risky. Therefore, when you are investing money in anything it is always worthwhile to have some other safety funds or deposit that will insure your stable financial situation. These funds are not for investing, they should help you live normal life for several months in case you will need it. First, even if your investments prove to be unsuccessful, you will remain paying your usual expenses from the safety funds and will not have to use any borrowed funds (loans). Secondly, it can happen that you will urgently need some money and in order not to sell your assets, you will be able to use your safety funds or deposit.
So, we have put some money aside and we are finally ready to start investing. Now the main question is: how much and where to invest? First of all, your passion and love of risk plays a role, as well as the goals you want to achieve. Do you just want to save money or to increase it? When we compose our investment portfolio, we constantly keep in mind these factors. The most common types of investments do not require you to have millions: shares, ETF shares, bonds, deposits in the bank.
Since the cryptocurrency is still a risky asset, they are most often given no more than 20% of all investments. It is important to observe the main rule of a good investor: not to panic and not to sell assets at lower price than you bought them for. The experience of the 2008 crisis shows that even if the shares fall almost to zero, they still grow afterwards (there will be the same situation at cryptocurrencies too).
Now, if you have some financial security fund and you are willing to risk a certain amount for the sake of potentially big profits, then you can invest in cryptocurrency.
How to do it? There are two ways: active and passive investment.
In the first case, you will constantly decide what kind of asset to go to (to buy), and from which asset to go out (to sell) in order to get a profit. The main goal of active trading is to show results better than the average on the market and to recoup the invested money, nerves and time. Typically, this type of investment is a full-fledged work, but some people engage in "semi-active" trading, combining it with other activities and making fewer deals.
With a passive approach, you also decide how much and in what cryptocurrencies to invest, but this time keep them until the moment when they can be profitable to sell. The main advantage of this method of investing is a small waste of time and nerves. However, while doing this, you give up the glory of a genius who steadily overplays other players on the market and constantly increases the deposit.
It is worth noting that both methods are suitable for investing in OctoinCoin. Its volatility makes it possible to engage in active trading. Its high reliability and liquidity allows long-term investments in this cryptocurrency, without fear of losing your savings.
