Investing in cryptocurrencies is one of the many options that currently exist to invest your money. In fact, it is quite difficult not to hear about the crypto market and its opportunities, however this noise does not mean that it is the safest way to invest money; it’s just an option gold ira companies reviews.
Last week I was completely shocked at a friend’s reaction when I asked him, “How much do you have in your bitcoin wallet? Suddenly he gave a derogatory look. “What happened?” I asked for. “It is a long story. I had heard impressive reviews from people who had become millionaires overnight with cryptocurrencies, so I thought it was appropriate to invest everything I had saved until November 27, 2017. I did not imagine that I was throwing a party welcome a lot of debt. I don’t think I can ever re-invest my money in cryptocurrencies. ”
I felt bad for him. But the big question is: did you do the research well before investing all your money? No, he did not do it. He only heard the positive testimonies of a few people and launched himself. After all, the crypto market is highly volatile. It is not a safe or low risk investment. So, don’t let the surrounding emotion lead you to make a risky decision like the one my friend made. But if you are already considering it, here are some smart ways to invest and get the most out of your decision.
(Note: I do not intend to discourage you from investing in cryptocurrencies. I just want you to be aware of the high risk that this implies and the way you can invest as a business person and not as a player.)
1. Do deep research before investing
To benefit from an investment in cryptocurrencies you have to do a thorough research on them. In this way, you will have more knowledge about the currencies in which you will want to invest and you will be able to understand the usefulness they have in the crypto world. One of the main reasons why many people were left owing cryptocurrencies is that they suffered a serious loss as a result of the dramatic crash of bitcoin and altcoin in December 2017.
Just like what happened to my friend, for not wanting to miss the trend, he entered the market without having done the necessary research and ended up getting into debt. In this type of investment, just like in currencies and stocks, you cannot bet to make money, but you have to be careful with the decisions you make, because the worst thing you can do is invest in cryptocurrencies without knowing how they work.
2. Don’t invest in trends or fashion
An intelligent investor does not make decisions based on trends or fashion, this is highly risky. If you want to make money from your crypto investments, you have to invest based on calculated risks and asking the right people. Relying solely on what people say is not smart. The price may drop suddenly, generating a huge loss.
Better, educate yourself well, ask the right people to guide you, and arm yourself with enough information before investing. Making money in the crypto market is not child’s play. You need patience and the right knowledge to generate worthwhile profits.
3. Understand the risk you can afford and invest only what you are willing to lose
Financial risks make some people nervous, while others live in the moment and jump on any potential opportunity. What side are you on? Be honest with your answer because it will help you decide what portion of your portfolio you should invest.
If risks make you nervous, don’t invest in crypto. There are many other investment options that are not as volatile. However, if you are one of those who take risks, invest only the part that you are willing to lose, in case things do not go so well.
And most importantly: there is no rule on the amount of investment. Just because Jan invested $ 4,000 doesn’t mean you have to do the same. If you are willing to risk more than Jan, it is your decision, and if you do not want to lose as much, it is also your decision. The important thing is that you invest within your own limits, that is, what you are willing to lose.
4. Dividing your money in more than one currency
A good strategy to reduce risk is to divide your investment into different cryptocurrencies. It has its complications, but it is better than investing in just one. Yes, cryptocurrencies are incredibly volatile in price, but it is highly unlikely that they will all fall at the same time.
Besides bitcoin there are hundreds of other currencies on the market. You just have to open your eyes, because there are also many frauds. Among the “real” currencies, study and choose the ones with the most potential, and then divide your money based on a calculated risk. The idea behind this (and all the tips mentioned) is to mitigate the risk of losing all your money.
