CRYPTO GUEST POST – Choosing The Right Strategy
Crypto guest post is a constantly growing market and it can be hard for investors to know where to put their hard earned money. There are two major strategies that investors typically adopt when looking to make an investment in the crypto space:
– Holding with the hope that things will “go up” (buying low and holding)
– Buying high, then selling once it hits a certain point – This strategy is called a pump and dump.
1. Holding with the hope that things will go up
This is one of the most popular strategies among crypto investors. The idea here is that you buy into a coin, wait for the value to go up, and sell/trade your investment when it reaches a certain point. This strategy is extremely risky because you are holding onto something that could potentially decrease in value backlinks. If this happens and you have no other options for reinvestment, then you have lost principal (money).
2. Buy high, sell once it hits a certain point – A pump and dump
This is where people get together at an agreed time (usually through an ico chat or discord channel), and all buy into a coin at the same time. This causes the value to spike and then once it reaches a certain stable price (or if they think it’s high enough), they all sell off their coins. This is a risky strategy because you are hoping that the coin will actually go up, but if you miss your timing then you will have lost out on potential profits.
Another thing to note is that with most of these strategies, you are holding onto your coins hoping that they increase in value. However, a lot of investors don’t realize how hard it is to actually hold onto coins. For example, imagine if you put in $1 into a coin and it increased in value by $10, but then you wanted to liquidate your investment. If the market has gone up since you invested, then the price can be so high that you no longer have enough money left over to buy back in. Basically, when making an investment (whether it be long or short term), you have to make sure that there is liquidity for your chosen token/coin. Find the site detail here.
3. Buy low, sell high – This is the most risky
This is the most common strategy but it requires the most planning and research. If you buy low and then sell when it hits a certain point, then you are trusting that the coin will actually go up in value. This can be hard to do since there are many other investors who won’t sell because they believe that their price will go higher, or because they want to hold onto their investment hoping that it will increase in value. The fact of the matter is that unless they’re on an exchange which gives them direct control over their investments (e.g. Binance), then they don’t have any control over how a coin’s price fluctuates (e.g. a coin might get delisted from an exchange), and they might not be able to sell their coins when they want to.
How to make an investment:
There are 6 things that you should always look into before making any decision about a cryptocurrency.
1. What is the coin’s utility? This basically means – why does it exist?
2. Who is behind the token/coin? Is there a strong development and seo marketing team? Has there been any controversy surrounding the team or the project?
3. What is the token/coin’s roadmap? What is being worked on currently, what was completed in the past, and what is planned for the future?
4. Does the project have a working product or application? If not, what stage is it at and when will it be released?
5. What is the market cap of an asset? (Market Cap = Price X Circulating Supply). This means that if you want to know how much one coin costs, you would multiply its price by its circulating supply. A high market cap generally means that the coin has a lot of demand.
6. Is there an expectation of a drop in the BlockChain price? This is important because if there is an expectation that values will drop significantly, then it is more likely for them to drop in value – how can you tell if potential returns are higher than expected? Here are some questions to ask yourself when assessing whether there is an expectation for a decline in value:
– Why is it expected? What effect might that have on the demand for the asset?
– What percentage of investors expect a decline? What effect might that have on the demand for the asset? Have they been publicly vocal about their expectations (e.g. on a reddit post or in a chat room)?
– How much of the asset will be delivered in the future? What effect might that have on its price? Will demand exceed supply, and if so, how will the price change?
