With the cryptocurrency industry emerging into the mainstream, now is an exciting time to be joining the evolution (& revolution) of currency. Below, I’m going to give you 4 top tips when building your own cryptocurrency portfolio.
It is impressive the amount of corporates, fund managers, hedge funds etc that have started talking about and investing in cryptocurrency protocols and applications. What do they know that the mainstream media has not reported? Why should you miss out on this early growth?
Cryptocurrencies like Bitcoin, Ethereum, and Dash are still not fully household names. Yet in the last few years their prices have risen drastically, (e.g. Bitcoin $3 to $2500+).
There are now Bitcoin ATMs, merchants that accept payment via these platforms, countries that are recognizing them as legal tender.
Is it too late? How do I start? Where do I start? How risky is it?
Now is a great time to start and be ahead of 95% of the population. But the best thing you can do is be smart when you are buying them, manage your risk, and look for the long term. In later posts, I’ll talk about the exchanges, ‘hot’ wallets, and ‘cold’ storage.
Buying shares, property, commodities always have an element of risk. Markets do go up and down. There are some simple ways to mitigate these risks and have fun while doing it.
4 top tips when building a cryptocurrency portfolio:
1./ Spread the wealth: let’s say you have $1000. You could put $400 into Bitcoin, $200 into each of Ethereum and Dash. The remaining $200 you could put into a couple of others that interest you. This would give you 5-7 investments into cryptocurrencies. Not a bad start to your portfolio.
2./ Keep Building: Every time you have some extra money. Look at investing into your original portfolio currencies or find some others. This approach is important as it allows you to smooth out any peaks and troughs in purchase price created by market volatility
3./ Know when to get out: Just like anything don’t ignore your portfolio. It is your hard earned cash in there. Be willing to keep updated on the industry and any changes in the landscape. This doesn’t have to be every day , it can be once per week, once per month. Try to stay current with overall market conditions, and know what is happening to the coins you invest in.
4./ Keep watchful eye on commission: understand any changes to the fees you pay when buying/ selling your coins. This fee occurs automatically as part of the transaction and should be stated as you approve the transfer. Again, it is just good management of your hard earned money.
The Bottom Line
Investing can, and should be fun. Treat it as educational, informative and rewarding. By having a little bit of discipline and using diversification, your long-term rewards should be beneficial. Enjoy.
On my next post I will show you how to build a quick excel spreadsheet to track your investments and the formula to help you watch the growth rates over time.
