How much money do you need to have to try your hand at digital money trading?, where to start and how not to lose your start-up capital?
Trading is a rather risky way of earning, which requires knowledge and skills. Cryptocurrency trading is even more dangerous as it is an extremely volatile asset. On the other hand, high fluctuations in the value of digital money allow not only to quickly lose capital, but also provide an opportunity to increase it.
“You can start trading cryptocurrency with $100-200”
Acquaintance with cryptocurrency trading is better to start with the spot market, says CEX.IO Broker financial expert Alexander Yaniuk. This will allow you to get acquainted with technical analysis, develop a trading crypto strategy and trading discipline without exposing the deposit to high risks.
When determining the starting amount, it is worth following the rule that its loss should not affect well-being in any way, Yaniuk emphasized. But it should allow you to take part in the auction long enough to be able to master the tools of trading crypto and work out the strategy.
“$100-200 is enough for this. You should not strive to earn money right away – this will negatively affect psychological stability. At the initial stage, the main task should be the formation of trading discipline and a trading crypto strategy, which in the future will be able to protect when operating with significant amounts using leverage,” Yaniuk explained.
If the first trading crypto experience is successful, then in the future you should analyze the average profitability that was obtained when working with a small deposit.
The expert also recommended setting a goal in real terms, which must be achieved per year or per month. For example, if the yield was 10% per month, then in order to earn $1,000, the deposit must be $10,000.
“In the ideal case, that is, with a uniform income of 10% from month to month, income in real terms will grow as the deposit increases.
But there are no ideal cases, and you always need to strictly adhere to the rules of trading discipline, this is the main guarantee of trading success in the long term,” the specialist noted.
“$1000 will be enough to start trading”
One of the main advantages of the crypto market is that you don’t need a large start-up capital to get started, explained Michael Ross-Johnson, CEO of the p2p cryptocurrency platform Chatex. According to him, a thousand dollars will be enough for a novice trader to purchase some cryptocurrency, transfer it to the exchange and start speculating using the chosen strategy.
“On the one hand, this amount is sufficient to buy cryptocurrency, on the other hand, it is not so large as to be afraid of losing it.
While there is no experience and practice, knowledge and understanding of the market may not be enough, and it is easy to be left without investments,” Ross-Johnson warned.
“The more funds on the account, the more comfortable and safer trading”
The most comfortable amount for cryptocurrency trading should be such that trading takes place with minimal risks, that is, without the use of leverage, Viktor Pershikov, a leading analyst at 8848 Invest, explained. For example, $13.7 thousand is enough to trade bitcoin “1 for 1”, or about $400 at the current rate to buy ETH.
“The more funds on the account, the more comfortable and safer trading will be,” Pershikov explained.
The smaller the funds, the more borrowing is needed to buy or sell crypto assets. Margin trading can be profitable and efficient if the trader has experience and knowledge in the field of financial analysis.
But a novice trader needs to learn to control risks and avoid losses in order to eventually reach an acceptable level of income, the expert emphasized. Therefore, the initial amount of funds should be sufficient and correlated with the current value of those assets that the investor is going to trade crypto.
