The short answer is "it depends". Continue reading for the long answer.
HODL means hold on for dear life. This means to buy and never sell your crypto too soon even in the face of a price drop mostly because you believe the price will be much higher in the future. Just HODL it.
According to Investopedia:
HODL is a term derived from a misspelling of "hold" that refers to buy-and-hold strategies in the context of bitcoin and other cryptocurrencies.
So the question is, is it a good strategy to buy and never sell (too soon)? In other words, to HODL?
In this post, I will be showing you under what conditions it's a good or bad idea to HODL and what and how to select which crypto to HODL.
What Cryptocurrencies Should You HODL?
According to CoinMarketCap, there are exactly 7,823 different cryptocurrencies currently in the market at the time of writing this line and about 90% of them wouldn't survive the next few (2-5) years.
Why is that?
Because they have no real-life use case or sustainable business model and a lot of them are outright scams.
So if you simply HODL any crypto that you have, chances are that most of your portfolio will be worthless in a short time.
Therefore, while HODLing is a good strategy for your long-term crypto investment (trading), you can't practice it on all coins.
What cryptocurrencies should you HODL then?
Only those with strong fundamentals:
A competent, experienced, and passionate team.
Have real-life use cases and not just another coin.
Strong partnerships and community.
Sustainable business model.
Competitive technology.
Click here to learn how to perform a cryptocurrency fundamental analysis all by yourself.
HODLing coins without good fundamentals and a future are as risky as blindly day-trading on leverage. You will lose your money in either case and very fast too.
So, yes!
HODL is a good strategy but only if you’re holding the right coins.
You may also like:
11 Best Cryptocurrencies to Buy Now for a Rich and Profitable Portfolio
I want to hodl in BCH what do you think?