With the current bull run and fast increasing cryptocurrency adoption, comes an influx of new investors.
But crypto is a Jungle, extremely volatile, and mostly unregulated.
To survive and thrive, you need to follow a set of tested and trusted strategies. Personalise them for your unique needs and constantly evolve.
That's why in this post, I will be sharing with you my 5 tips for the new cryptocurrency investors.
1. Educate yourself. #DYOR
Never invest in a business you don't understand. ~Buffet
Ok!
Now, that's an almost overused quote, but it's too important to ignore.
It is recommended to get some form of knowledge before getting started in a complex and intense field as cryptocurrency.
There are tons of resources on how different cryptocurrencies work.
Educate yourself using different forms of educational resources on the internet.
These include.
Crypto news and educational websites
Social networks like Telegram, Reddit, Twitter, and Medium.
Listen to and watch interviews, podcasts, documentaries, etc.
YouTube videos
This way, you will find different information regarding different topics concerning bitcoin and cryptocurrencies.
On this note, I invite you to join our Telegram community of passionate and knowledgeable crypto investors.
Where we share knowledge, experiences, ideas, strategies and more towards becoming a more successful crypto investor.
2. Maintain self-custody and use only trusted platforms
Any crypto wallet that won’t give you your private keys should be avoided at all costs ~ Elon Musk
With crypto, you're your own bank. Only you should have access and control to your money.
Remember, "not your keys, not your coins"
As much as possible, avoid using centralized platforms because that adds another layer of risk to the already risky cryptocurrency investment.
If you must use a centralized platform to buy or trade for example, only use it for as long as it is essential.
Once you're doing with buying, converting, or trading, move your coins into a wallet that only you control.
Also, strive to use trusted and reliable cryptocurrency exchanges or other centralized platforms.
Each exchange platform has different features. So choose the one that best satisfies your unique requirements.
And that you find easy and simple enough to use.
Some crypto investors prefer p2p exchanges where they transact directly to another seller without the worry of transaction fees charged by exchanges.
In contrast, others prefer the additional security of centralized exchanges and don't mind paying extra to purchase their coins.
Nevertheless, choose a secure exchange platform that will meet your deposit and withdrawal needs.
3. Keep track of your investments.
If you can’t measure it, you can’t improve it ~Peter Drucker
Constantly monitor, evacuate, re-evaluate, balance, and rebalance your cryptocurrency investment portfolio like a diligent businessman.
You have to know whether you're making money or losing money. Where and how you're losing or making the money.
Know "all" the numbers.
Why?
Because you cannot grow or improve what you can't measure.
I mainly use the free CoinGeck portfolio and CoinMarketCap Watchlist tools to keep a tab of both the coins I am already invested and the ones I plan to follow their developments.
There are other paid and "advanced" portfolio tracking tools in the market but they're not worth it in my opinion.
Or let's just say, you don't need them as much.
Use the free ones highlighted above and others that you can find.
Also, some exchanges like Binance have statistics that show you your daily and all-time trading profits.
So, if you're trading on that exchange you will know how much profit or loss you have since you started.
Which is very handy to evaluate your trading success or failure and develop strategies to maximise your potential profitability.
Overall, learn to keep an up-to-date record of your investments.
Some of the major record to keep are:
The date you bought
The total dollar amount you invested
The amount of the coin or token you bought
The price you bought at
Any withdrawals
How much you have sold, and the price you sold
etc...
Just the necessary information to help you know what you're doing.
4. Use the Dollar Cost Average (DCA) Strategy
One of the tricky problems many beginners face is the right strategy to accumulate cryptocurrencies.
One popular and most recommended strategy is dollar-cost averaging. This involves buying a particular cryptocurrency on a fixed or arbitrary regular basis.
This allows you to purchase your favourite cryptocurrencies within your income or on a budget.
You can determine how much you want to invest every week, or month as the case may be.
However, note that this strategy should be employed only if you aim to accumulate that particular for the long term. And the current dollar price is irrelevant.
However, for other speculative investments, you will want to try and buy the dip and wait to sell when the price pumps.
There're a lot of ways you can apply the DCA strategy based on your unique situation.
5. Invest reasonably
Sorry to disappoint you, you will not become a millionaire "overnight" just because of you invested in crypto.
Most people (beginners) view cryptocurrencies as a get-rich-quick scheme.
If you have that mindset, you will be disappointed and that is your problem.
Your cryptocurrency investment decision should be well thought out and not rushed.
Do not take unreasonable risks and always maintain proper risk management strategies.
Most importantly...
Never invest more than you can afford to lose.
The cryptocurrency market is extremely volatile. There's a high level of market irrationality, manipulation, speculation.
All contributing to shaping the outcome of your investment.
And most of these things are outside your control.
So you wouldn't want to risk the kids' school fees or health insurance fund in this.
Resources to get you started:
How to perform a cryptocurrency fundamental analysis all by yourself
11 best cryptocurrencies to buy now for a rich and profitable portfolio
Conclusion
Keep yourself educated by constantly doing your own research (DYOR).
Learn to filter all the information on YouTube, Twitter, Telegram and other social media channels where crypto is being discussed.
A lot of people are being paid to tell you to buy some shitcoins. Always "use your head".
Are you a crypto newbie? How did you learn about crypto what's been your experience so far? Share with us in the comments section below.
