The cryptocurrency market has the power to shake up the lives of so many people and businesses. Some people talk about how they earned thousands overnight when just the day before the market value was down. Cryptocurrency is a highly volatile asset. This means that it changes rates very rapidly and in big numbers. So, if one day a crypto coin is worth $10,000, the next day it could be down to $100. The thing is that you never know. Despite the uncertain future that investing in cryptocurrency brings, everyday more and more people are joining the bandwagon. If you really want to earn money from cryptocurrencies, then you need to do it the right way. Shay Benhamou, a cryptocurrency investment expert, shares his top tips that you need to remember when trading cryptocurrencies.
Top Cryptocurrency Investment Tips
Follow The Dominant Crowd
Shay Benhamou emphasizes that investors should not try to create their own trend or walk away from the dominant crowd. A lot of the new investors think that they can do something new or make more profit by finding their own path to success. However, this works out for only a very low amount of people. As a new trader, you should stick to the dominant crowd of cryptocurrency investors. This is more likely to bring you fast profits than you finding your own way.
It’s Not All About Luck
New investors often make the mistake of thinking that they can just wing their investments. While this may work out for them sometimes, you cannot always rely on it because successful cryptocurrency investments require calculated decisions. You should always follow proper trading strategies when you are investing in assets as volatile as cryptocurrencies.
Trust The Stop Orders
Cryptocurrency exchange platforms provide traders with several trading tools. One such tool is the stop order. Traders can use this tool to set their limit of investments and it notifies them when they are about to pass the set limit. It is important that you listen to the stop orders that you can. If you think that investing in an asset that is falling at the moment is a good idea because it may rise someday, then you are wrong. Shay Benhamou says that you should close your position as soon as your price reaches your stop limit.
After-Hours Market Orders Are A No-No
The stock markets of assets are open for certain hours in the day. If you want to place an order for an asset, make sure that you are doing it during open market hours. After-hours market orders are never a good idea because you don’t know what will happen during the time that you are offline. You may end up with bad fills of assets. So, don’t browse the markets before bedtime to place an order because it will not work out in your favor.
Diversify Your Portfolio
The crypto market is very volatile. To make sure that you don’t suffer the brunt of the negative side of this volatility, you need to diversify your trade portfolio. There are many different crypto coins in the market so don’t only focus on investing in Bitcoin or Ethrereum. If you don’t have a lot of funds that you can afford to block for a while, then you should invest in minor cryptocurrencies that are not as expensive as Bitcoin and Ethereum. However, make sure that you are not putting all your money into one asset. Invest small amounts in different currencies to minimize the loss that you may have to overcome due to sudden fluctuations in the market.
Shay Benhamou is a cryptocurrency investments expert and shares his knowledge with people who share the same interests. If you are a new trader, you should know that it is very important to study the asset, how to invest, what is a good investment deal, etc. before you actually start to invest. This is because, a mentioned above, profits from investments are not all about luck.
So, if you are new to cryptocurrency investments, make sure to keep these tips in mind. These tips will save you a lot of money and time that new investors often end up losing.