Investments in digital assets are considered high risk due to their volatility. What part of the capital is better to allocate for the purchase of tokens and how to reduce risks at the same time.
In the cryptocurrency market, sharp fluctuations in quotes are often observed. For example, on November 16, the price of bitcoin collapsed by more than 10%. A sharp decline in the value of the first cryptocurrency was also observed on September 7. Then the asset fell in price by more than 20% per day. experts explained how to secure your investments in cryptocurrency and make investments more efficient.
- Correct Risk Assessment
The cryptocurrency market is characterized by increased risk, and the probability of losing your funds is high, experienced investors and large funds take this fact into account, therefore, they assign no more than 10% of their portfolio to work with crypto assets.
“This is a very reasonable approach. 10% is enough to experience the profit that cryptocurrencies can bring. On the other hand, the next crypto winter will not hit the portfolio hard if there are only 10% of digital assets in it”
- Saving Funds
If we talk about investing in terms of, first of all, saving funds, then it is necessary to closely monitor the cryptocurrency market and buy more conservative assets, with this approach, the share of digital assets in the portfolio can reach about 30%.
Despite the fact that the assets of the decentralized finance (DeFi) sector are among the most profitable, it is better to refuse to buy such tokens to reduce risks, the expert warns.
“DeFi projects are indeed the most highly profitable on the market today, but the higher the profitability, the higher the risks”
- Effective Algorithm For Beginners
For a person who is not a professional trader or investor deeply immersed in the topic of cryptocurrencies, it is dangerous to invest more than 5% of capital in crypto assets, it is especially likely for a beginner to enter the market at maximum values, as well as to be involved in various fraudulent schemes.
The most effective and proven scheme is the allocation of non-critical amounts for investments, which must be invested in equal shares every month in bitcoin, Ethereum, Binance Coin or top stocks, such tactics can bring good returns in the long run and allows you not to spend a lot of time on investments.
“Coin Top Secret” does not give investment advice, the material is published for informational purposes only. Cryptocurrency is a volatile asset that can lead to financial losses.
