As you get deeper into your investments with various cryptocurrencies, it can end up becoming difficult to manage. You could be on multiple exchanges that you need to log into individually. Or, you have a few trades to execute and need to know which ones are supposed to happen and when. And when you are dealing with company investments then there can be even more moving parts to deal with.
When you are trying to buy USDT to move your cryptocurrency into stablecoins, or trying to decide if you should HODL during a dip, you need to have a plan and a management strategy.
In this article, I will go over some ways to make sure that you are in total control of your portfolio of cryptocurrency.
1 – Remain rational
There is a lot of hype surrounding cryptocurrency particularly when there is a big gain in value. Unfortunately, a lot of the hype is manufactured. Also, when things are dipping, there are some forces that are aiming to crash the price so they can buy low.
It pays to keep emotions as far away from the decision making process as possible. Keep a clinical eye on your portfolio so you can make clear decisions that are not based on your gut feeling or fear of missing out as they can have a negative influence.
Have patience and weigh your decisions based on what you know and from past experience. Don’t follow what the gurus are saying as you don’t know what their motivations are.
2 – Diversify
Having one type of coin is not a good idea when you are investing. It is much better to spread out your risk. Not only in terms of having more than one coin, but also more than one type of coin.
For instance, stablecoins like the above mentioned USDT or Tether, is a stablecoin that is pegged to the US dollar. Other types of stablecoins are also pegged to an asset like fiat currency or even gold and other commodities. This makes them less risky if the market is stalling or even crashing.
Have your high risk and high reward type of coins that are heavily speculated upon, but make sure you include less hyped and less volatile styled coins.
3 – Have an exit strategy
When you are buying in, you usually are looking for some types of milestones that will indicate when it is a good time to buy. Something that you would want to see that might be a tip off that the value is about to bottom out and be close to its low point which is when you want to buy it up.
Likewise, you should have some landmarks to watch out for when you already own the coins that will give you a clue that it is time to bail out. When you are buying low and selling high, you have to know how to identify the peak so you can sell before the value drops.
Set up some of these markers when you have learned all about the coin. Keep an eye on announcements from the developers and also understand what outside influences would affect the value so you can determine the right time to sell.
*This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.